09 Jul 2010 23:52:

Dear Maria

Please permit me to "eat humble pie" and admit that you were right and I was wrong about the most important aspect of this discussion - Does an owner of a single property in the Valencia region have to register it as a Tourist Unit or not?
The answer is NO! The owner just has to register that there is tourist interest but there is no registration number or the need to quote this in an advertisment; you also correctly referred to this fact in another thread.
HOWEVER - The owner of a single property is obliged to comply with all the other conditions, which you set out in the first post of this thread.
Apart from this, anyone who comercialises TWO or more properties, whether owned directly or rented on behalf of the actual owner, is obliged to register each property and publish the registration details.

I was misled about this point by an abogada acting for my trade association. To my best knowledge she was in turn misled by an official of the Valencia Toiurist Agency. The question has now been clarified and the association sent a note to all members in this respect.

Thank you for you patience.

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17 Dec 2009 19:43:

Answering TP1's comments:

I can promise you that there is a lot of talk in financial circles about a possible breakup of the Eurozone.
However opinions vary and some say, like you,  that the stonger economies will be prepared to bail out the weaker in order to further the idea of a strong Euro to replace the USA dollar.
Nevertheless the European community would insist on taking the defaulting countries into "administration" as far as the bail-out package is concerned. The big question is: Would countries like Spain and Greece submit to this loss of control over fiscal policy?

I am not convinced that they would. The other options they would have is an IMF bailout but they would have to leave the Euro of course. Ireland seems to be getting its act together with the new budget. Someting has to happen as far as the others are concerned but who can say how it will pan out in the end.

An interesting comment from an article at http://www.finfacts.ie/irishfinancenews/article_1018682.shtml which places Spain at the top of the "misery list" -

"Moody's, the international ratings agency has ranked Spain as top of its Misery Index  - a metric which adds a country's fiscal deficit and the unemployment rate - and Ireland gets a fourth ranking.
Spain, is followed by Latvia, Lithuania, Ireland, Greece and the UK. The US is eighth - just after Iceland.
The original “misery index”  - an addition of inflation and the unemployment rate  - was invented by economist Arthur Okun in the 1970’s while he was a scholar at the Brookings Institution in Washington DC. Previously he had served as a member of President Lyndon Johnson’s Council of Economic Advisers and a professor at Yale."

Probably the most informative artice is from the Financial Times - Will rising debt cause a Eurozone breakup?
OK, even the FT writers are not always right but I am just saying that a Eurozone breakup is being discussed seriously. Please have a look and tell me what you think.

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11 Dec 2009 14:59:

Kevin

The way you have done has to be exactly right. Of couse there are lots of stories about aborted projects with unfinished buildings, off-plan buyers who have fallen foul of dishonest developers etc. On the other hand there are lots of "enclaves" where development proceeded relatively slowly and buyers were able to purchase with complete security and enjoy their properties for half a lifetime.

Of course buying off-plan is risky and not only in Spain. However hard you try to sew it all up, with bank guarantees etc., there is still the risk of the developer becoming insolvent and years of uncertainty, without use of the property, while it all gets sorted out. The only sure way is to buy a resale property. Alternatively, in the case of a detached villa, at least structurally finished with all of the infrastructure in place.

I have lived (and worked) in Moraira, which is one of the "enclaves" I was talking about. I have heard of Playa Flamenca, never been there but I guess it is about the same. Life goes on in Moraira as it always did, in spite of the recession, apart from the fiercesome increase in the cost of living.
There is still a lot of interest in real estate and the surviving estate agents are rushed off their feet. The only difference is that they have to show 3 or 4 times as many properties as before to achieve a sale. What the hell anyway - they still get paid well for what they do!

Prices have fallen by 25% to 30% and sales have fallen to a quarter, or less, of the peak. New building just don't exist any more but there is hardly any land available for new developments anyway. Even if there was the developers simply could not compete pricewise with the resale offers.
I think what is happening now is that buyers are thinking "Sod it! If I don't do it now I never will" - just like you , eh?

I used to be a developer myself but packed that up when I came unstuck during the recession of the late-1980's. Now I have a holiday rental agency.  One thing I have noticed recently is that a healthy demand has developed for long-term lets. So it would seem that people still want to live here in spite of everything.

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11 Dec 2009 13:50:

I do think that Brian is right and his attitude is representative of all of those who bought for the right reasons i.e. to acquire a property to enjoy and not just a short-term profit.

However, I still don't think that those who got caught up in the boom and have now lost out, either due to falling property value, corruption or actual fraud, are really to blame. The blame lies with those who made it possible. I do believe that most of those responsible for fraud and corruption will be prosecuted and eventually Spain will get its act together because otherwise they just don't have a chance of recovery.

However, the problems do not only apply to Spain and it still seems to be happening right now - Dubai!

At the end of the day we have to try to put it all behind us and move forward and the question I was asking when I started this thread was how and when. There are still a lot of people around like Brian. He had a holiday home in France, which he obviously sold, and now he has a holiday home in Spain. He says that he had no expectations about making huge profits but just to improve his lifestyle. There are still a lot of buyers around like him but they are all holding off right now and waiting for something to happen.

Basically the cost of living has to improve and we have to see signs that the property bubble has completely collapsed. Mr Shoemaker & Co are still saying that the Spanish economy is about to start to recover but I don't thk that they even believe it any more. The banks are still desperately trying to hold prices up because they are stuck with most of the unsold properties that they have either foreclosed on or swapped for debt. Meanwhile they are getting deeper and deeper into the red, unemployment is continuing to rise and Spain's external debt is continuing to rise.

Iceland was the first, Greece is almost there and Spain is slowly sliding down the slippery slope to bancrupcy. They simply have to face up to it, better sooner than later, because until they do that nobody will take them seriously any more.

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10 Dec 2009 19:06:

Kevin

"Would a default bring its own penalties?" Normally I think yes because the defaulter would be ostracised. However, if all of the countries I mentioned partly-defaulted at the same time, then others would just have to accept it as being less than the greater evil of total default.

I agree with you heartily about the cost of living here, it is simply not sustainable. I have lived and worked in Spain since 1971. I am now 67 and should retire but I have to keep working and running my business (Holiday Rentals) because all my investments have gone belly-up.

Interesting theory about the sub-economies and perhaps the plan could work. I think that there would have to be 3: Northern, Mediterranean and Eastern because each has a different set of problems.

Whatever, something has to be done and quickly because the situation seems to get worse by the day. One thing I don't understand is why such sensational posts don't get more attention but perhaps it is because most people don't understand. I first wrote about the developing property bubble in 2004 and my message was "Stop now before its too late". I was only thinking of Spain and had no idea that the same thing was happening all over. Had I know that I would have sold everything I had, rented and been a wealthy man now. As it was it seemed to me that they were just building a few houses too many, which would eventually cause a minor, local recession.

My 2004 Article: Spanish Real Estate Crisis Unbelieveable what I said then, silly really -

What will happen to Spanish Construction?

I believe that the Spanish Economy, especially Tourism and Construction are heading for a serious recession. Hopefully it will not be as severe as in the ’90, when property values in coastal areas fell by more than half. A recent article suggests that prices will fall by up to 20 - 30% hopefully it won’t be worse than this.

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