How Financialy secure are RYF

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/07/15/ccspain115.xml&CMP=ILC-mostviewedbox

With the Spanish economy in severe recession and property companies going to the wall every day how financially secure 
are RYF and how long will they continue to pay the service charges and IBI on the properties they still haven't sold.

Should we be setting aside some additional reserves 

They didn´t pay April´s bill to duquesa suites...about 20 units.  

I soppose if they did not pay  we would need a new president as they would lose their voting rights...and the new president can begin proceedings to seize all apartments in default...about 300 i bet. they then get sold by the courts ( and a few bargains to be had i expect) ...not all doom and gloom then

Michael,   I read similar reports about sizable Spanish builder having liquidity problems this week (FT).

Unlike UK builders,  the Spanish builders hold very large stocks of unsold properties and RfY seem to be no exception.
Financing such large inventory is costly.
You being an Accountant (as I once was) you will not be unfamiliar with such cash flow management situations.
They need to sell  (i.e. complete)  so many units  each month to keep the cash flowing.
If sales in any month fall below, then creditors cannot be paid and lending cannot be serviced.

There will be bargains to be had for sure for those who are daring enough and can fund it through the recession.
My thoughts went  along the similar lines as John's.    Every cloud has a silver lining if you only know where to look.

One thing is for sure.  Having just read "Six Degrees"  I wouldn't buy anything by the sea that isn't  10 meters above sea level.
Buying anything so low  would be like buying leasehold  with less than 99 years to run. 
That's one good think about DV, it's well positioned for the eventual rise in sea level.

regards,

Paul

This message was last edited by PMillsom on 7/19/2008.

I was told RyF haven't paid community fees for Marina de la Duquesa either and that they have been advised by their Madrid office to stop paying.  I believe they are clearing out of the whole area imminently to resume commercial work in Madrid.  I am very worried about this as they still own hundreds of apartments...


This message was last edited by carolinej on 7/21/2008.