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Spanish housing minister appeals to British buyers to return
07 February 2011 @ 14:21

The Spanish government has launched a direct appeal to Britons to help kick-start Spain’s faltering economy by buying some of the country’s 700,000 unsold houses.

Beatriz Corredor, the Spanish housing secretary, promised new planning laws to end the confusion which has led to some British home owners being ordered to knock down their properties deemed to have been illegally built.

“Come here calmly, and trust in the system that we have and the transparency we provide,” she said.

“There is a very attractive offer on the table here, with prices significantly lower than two years ago, and you will certainly find what you are looking for.”

Her plea reflects growing alarm in Spain at the huge stock of newly built homes waiting to be sold - of which 400,000 are near the coast - since the country’s economic crisis began. Prices have tumbled by up to 40 per cent and banks and construction firms are desperate to recoup some of their investment.

In recent years, Britons have bought one third of all Spanish properties sold to foreigners. But many have recently been put off by horror stories of planning permission being retrospectively revoked and other complications, and the number of British buyers has slumped.

According to government figures, 100,000 homes built around the coast during the last decade face unresolved planning problems, and residents say the true number is even higher.

“The British are our highest priority and are those about whom we are most concerned,” Mrs Corredor told The Sunday Telegraph. “It is true that there has been... an image problem. Now we want to reassure the British, and all foreigners, that we are doing everything possible to put the details clearly on the table.”

As part of a package of legal reforms to be steered through the Spanish parliament this month, for any property being sold the local council will be obliged to provide a document stating clearly its boundaries, the category of land on which it stands, its access to services including water and electricity, and details of its planning approval.

If someone buys a house with all the correct paperwork, Mrs Corredor said, they could be assured of its legality. “If there is not any mention of legal proceedings on the document, the person who buys the property through the correct channels will then know there is judicial support."

An estimated one million properties are currently on the market across Spain, including homes that have already been lived in by at least one owner.

The Spanish government’s hope is that a return of British buyers will give a boost to the ailing economy by injecting much-needed liquidity into the banks, creating work for those involved in fitting out homes and helping to draw a line under free-falling property prices.

Over the next few weeks the Spanish government will also embark on a “roadshow” around Britain and other northern European countries to promote the country’s property market. House prices have fallen on average by 24 per cent in the Malaga area and by 19 per cent in Tenerife, Mrs Corredor said. “They are very attractive reductions, especially in properties of high quality. They are properties that are worth the trouble.”

John Heyes would agree. From his beachfront apartment on the Costa del Sol near Estepona, which he bought just over a month ago for €161,000 (£136,000), a full €100,000 cheaper than its original price, Mr Heyes, 66, urged others to seize the moment.

“There are hundreds of thousands of properties around, all at seriously discounted prices. Do your research and take your time, but it is a great opportunity.”

Nick Stuart, a British estate agent who runs the website Spanish Hot Properties, said: "There are huge bargains to be had there, such as villas in Marbella that are almost at half their previous prices.

"Get a decent independent lawyer and make sure that the property rights and bank guarantees are in place. Ninety five per cent of these horror stories could have been avoided."

But others are not so sure. And i the golf resort of Villamartin, near Alicante in south-eastern Spain, the scale of the problem facing Mrs Corredor becomes clear.

There are 120,000 empty new homes in the wider region, and in Villamartin rows of whitewashed houses sit empty, waiting for an owner. Signs hung over the balconies offer cheap sales for properties repossessed by the banks.

Sun-bleached billboards along main roads, advertising in English and Russian, offer dream holiday homes, but the empty streets, with just the occasional car with British number plates, tell a different story.

Robin Barton, 65, has lived in Villamartin for 10 years, and sitting outside The Stray Sod Irish bar, he said it would take more than a slick marketing campaign and technical changes in the law to bring back the British and end falling prices.

“The simple fact is that the Spaniards built too many homes,” he said. “There is just not the demand for all of these houses, and with the rest of the EU in crisis too, nothing the Spanish government does is going to make people buy them.”

He pointed to the shell of a half-built block of flats, its exterior walls complete but the building uncompleted inside. “That’s been there for years. And no one will finish it. It just proves the lack of planning that caused all this mess.”

Gabi Baischer, managing director of In Sun Properties in Villamartin, has not sold a single property to Britons in the last month. Flicking through her records, trying to recall the last time that British clients came to buy homes rather than sell, she said there were now only Scandinavians and Russians.

She drove around the winding roads of Villamartin, circling the golf course and past the Irish pub, pointing out the most heavily discounted properties. Everything is being sold at a vast reduction. On Thursday she sold a two-bedroom whitewashed townhouse for €107,500 (£90,700) — less than half the initial price.

A British family is selling their villa with a swimming pool, originally bought for €320,000, for €260,000. A third property, a pretty three bedroom semi-detached villa with views down to the coast, is on the market for €205,000 — €120,000 less than its original asking price. It too is being sold by Britons.

“Over 90 per cent of our business three years ago was British people buying,” she said, “and now, it’s maybe two per cent. It has totally dried up.”

Meanwhile those who have become ensnared in complex legal disputes of the kind that have been a bugbear to foreign buyers - with some cases ending up in the European Court - warn that not even Mrs Corredor’s change to the law will solve the problem for new buyers.

“The government in Madrid can give all the assurances it wants, but without it enforcing the laws nothing will ever change,” said Charles Svoboda, whose Valencia home has been the subject of legal wrangling for the past eight years. His support group for property owners taking court action currently has 30,000 members in Valencia alone.

“The problem is that housing is often dealt with at a regional level, and national rulings make no difference whatsoever. And in small towns, there is often no one who is technically competent to enforce these laws.

“I wish the government all the luck in the world with these new proposals, and am sure they are well intentioned. But here it is like Alice in Wonderland. The housing rules may look the same, but actually everything is totally backwards.”

Maura Hillen, 46, bought a home with her husband John near the town of Albox, 130 miles south of Alicante, only to discover too late that it had not been legally approved. She is sceptical about the impact of the new law, which in any case will not apply retrospectively to cases like hers.

“I look out of my kitchen window and still see houses being built where they shouldn’t be,” she said. “And for people like us, who bought our place three years ago and are trapped in legal limbo, you feel as if the four walls are closing in on you.

“We are being hounded by a machine that will not move, that will not blink. The legal situation for housing is just crazy.”

They have formed a residents’ association which has 700 members, and this weekend are meeting 36 other organisations in Andalucia to campaign for their rights to be respected.

They say that Britons considering a move to Spain should still be very cautious.

“Many places have the veneer of legality, but these laws from Madrid are never enforced on a local level,” Mrs Hillen said. “Their intentions are correct, and I do think their efforts are in the right direction.

"But at the moment I would honestly say that British buyers should go somewhere else.”

Source: The Telegraph



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10 Comments


4 years and still waiting said:
07 February 2011 @ 14:30

Perhaps this is the person who everyone should be sending their petitions to. There must be thousands all over Spain caught up in the legal wrangling. Until Spain can sort out the dishonest, town planning officers and mayors, builders, estate agents, lawyers, developers and 'banks' the British will not gamble their money in Spain, especially in the credit crisis now in Britain.

Perhaps it would be good public relations, publicity, and marketing if she could become involved in the present housing crises affecting so many people. The money presently tied up in all these legal battles is benefitting someone, is the Banks, the developers, - who? Certainly not the British who she is trying to convince that all will be well in Spain.


4 years and still waiting said:
07 February 2011 @ 14:31

Perhaps this is the person who everyone should be sending their petitions to. There must be thousands all over Spain caught up in the legal wrangling. Until Spain can sort out the dishonest, town planning officers and mayors, builders, estate agents, lawyers, developers and 'banks' the British will not gamble their money in Spain, especially in the credit crisis now in Britain.

Perhaps it would be good public relations, publicity, and marketing if she could become involved in the present housing crises affecting so many people. The money presently tied up in all these legal battles is benefitting someone, is the Banks, the developers, - who? Certainly not the British who she is trying to convince that all will be well in Spain.


Anne said:
07 February 2011 @ 19:07

Only when court delays and delays to judicial resolutions are placed at the head of the governments' agenda to enable all outstanding cases to be fairly resolved and innocent purchasers recompensed will there ever be a chance that British buyers will return to the Spanish market place. Until such time, then the Buyer beware warning will remain. The grave injustices that are predominating the real estate scene have to be addressed if Spain is ever to regain credibility.


Anne said:
07 February 2011 @ 19:38

When those of us innocent victims embroiled in the Spanish justice system read this "Over the next few weeks the Spanish government will also embark on a “roadshow” around Britain and other northern European countries to promote the country’s property market. " it makes sense for us to step up our own campaign, and to use this as a stepping stone to ensure that the British public are made aware of why we have to continue to advocate the message "buyer beware". Surely it's in everyones' interest to ensure that the thousands of outstanding cases of Spanish injustice are resolved and fast tracked through the system. Banks who reneged on their responsibilities according to Law 57/68, developers who have breached contracts, local officialdom who have corrupt self interests when ignoring the laws of the land, and negligent legal professionals who have demonstrated lack of due diligence to follow law 57/68 at best and corruption at worst (in league with developers and banks) should all be made accountable for this disgraceful and far reaching effect on the real estate market. Only when innocent purchasers and those who have been used as pawns within regional and local government disagreements see their judgements honoured and recompense forthcoming will we ever consider Spain as a civilised place to invest.


Sandra said:
07 February 2011 @ 21:16

I entirely agree with all the above comments.
Perhaps an organised demonstration at all the venues planned for these 'Roadshows' might bring some results.
Certainly an open letter in the Telegraph addressed to Beatriz Corredor would be in order.The instigators of the various petitions could, together, draft a letter drawing attention to the plight of those caught up in the recent 'Spanish Property Scandal'' and explain that thousands caught up in it are still awaiting justice in the form of a refund or a property.
It would definitely get people talking about cheap property in Spain. 'Tho wether it would help to sell any property is another story.


David said:
08 February 2011 @ 11:07

The comments above are spot on, and are the very reason that Spain's property market will continue to fail unless people like Mrs corredor can get their head out of the sand and accept why so many people from the UK are so angry, and will spread that anger far and wide until something is done to bring justice to those cheated thanks to lack of regulation, corruption, court delays etc etc. Only when some sort of compensation fund is set up to tackle the losses suffered by those cheated, will most people start to trust that the Spanish property industry is even worthy of consideration because it's prepared to put right the many wrongs that have done so much damage to individuals, the property industry and Spain itself!!.
For instance, how many people followed all the rules, have won cases in court against vile crooks (who have taken full advantage of the hopeless system in Spain), but still have nothing to show for their court win following years of expense, stress and worry??, and how many have bought property, only to be told at a later stage it's illegal and will be pulled down at some stage?, and how many are victims of hideoud bank guarantee fiasco that has not been dealt with yet by government??
If the Spanish government wants to promote it's property industry through road shows, then those shows need to include a clear list of contactable people who have been compensated for the wrong doing against them by ultimately the Spanish government. The reality is that unless Spain gets to grips with compensating those it's cheated, the roadshows will just be a farce, based on lies and failure to admit the betrayal of so many decent people who put their trust in Spains legal system.
The Spanish government and the whole property industry are being watched and have the perfect oppotunity to show potential new property owners that the old system based on lies and corruption is dead, and that they can buy with confidence, but while Spain continues to refuse to compensate those awaiting justice now, most will continue to feel that words and road shows mean nothing and can not be trusted as anything but more lies in desperation to extract money out of decent people without any proof of future justice if and when they need it?


Sam Mc Kibbin said:
08 February 2011 @ 14:22

I lost a courtcase in Marbella trying to recover my deposit for over 150,000€ plus legal costs. All funds were in place to complete on time.The completion was months late, The bank Barclays would not release the funds because the occupation licence was not in place when our solicitor required it to complete. The property was in Santa Maria Village, Elvaria, Marbella. Months after & about the time of the hearing they seemed to get the licence. The developers were demanding considerable additional expenses. I lost everything.


Maria said:
08 February 2011 @ 16:46

Keith Rule´s petition is also directed to this person.



vicky said:
08 February 2011 @ 19:20

we are still 4 years and waiting too. We have two properties which we are taking through the courts as the developer was out of contract (by 2 years). Thought this would be a fairly s traight forward process as not only did it state in the contract that monies would be refunded with interest etc if the development was delayed, we also had bank guaratees in place. We employed spanish lawyers which were recommended to us in Oct 08. We had to pay they a substantial amount up front. They submitted all the paper work to the courts straight away. We heard about one of the cases being sucessful new years eve 2010. (Over two years later) We were told that the developers/banks etc could appeal and that this was opened ended. so what was the point in the Judge ruling in our favour? So still waiting news, as for the other case, who knows? It was submitted at exactly the same time Oct 08 but it hasn't even been heard in court yet. So I would advise anyone to be very cautious about buying property in Spain, until new laws/procedures etc are in place. We are totally frustrated and the money we have invested I am ashamed to admit. Had the development come in on time, we would now own them. So it's not a case (as often thousands of us are accused off) pulling out because of the recession.


Keith said:
09 February 2011 @ 18:16

The Bank Guarantees In Spain Petition is, among others, addressed to:

Excelentísimo Señora Beatriz Corredor Sierra
Ministra de Vividenda - Ministerio de Vivienda del Gobierno de España

Her comments are very interesting:

“Come here calmly, and trust in the system that we have and the transparency we provide. There is a very attractive offer on the table here, with prices significantly lower than two years ago, and you will certainly find what you are looking for.”

The only thing I have been looking for is my missing Bank Guarantee and now a full refund of my deposit.

Señora Corredor - I am very much looking forward to attending your roadshows........!!

Kind regards

Keith
www.bankguaranteesinspain.com









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