Housing prices are on the rise in some coastal areas

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05 Jun 2013 20:07 by eos_ian Star rating in Valencia. 498 posts Send private message

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The regional authorities have assured British investors that property prices in the Alicante towns have already begun to rise due to foreign demand. Isabel Bonig, Minister of Infrastructure, Planning and Environment for the Valencian Community, said today in a presentation to investors held at the Spanish Embassy in London that "the decline in housing prices in the region in recent years has slowed, and in some areas are starting to climb again. " Specifically, Bonig cited the case of the towns of Torrevieja and Calpe Alicante, two of the favorite destinations for tourists and investors in the UK.

"In Torrevieja prices have jumped 3%," she said. "It's a town that attracts foreignors for its good location, the quality of existing housing and infrastructure." There are 18,000 Britons living in that town, according to the Government. The Minister was speaking during a visit to London that aims to attract more foreign investors to the Valencian coast. At the meeting were representatives of Singapore's Sovereign Wealth Fund and investment company Greenoak Real Estate, as well as real estate agents and English lawyers who do business with individual buyers.

Isabel Bonig admitted that there are still about 455,000 empty homes in Valencia, but added that the property offering has already been adjusted in some areas  in terms of price and demand and even new developments begin to emerge.

"There are projects that are already sold off plan," she said. In 2012, foreigners bought 15,509 properties in the region, compared to 10,580 in 2010. In the first quarter, 3,137 homes have been acquired.

However, the average price has dropped from 153 885 euros seen three years ago to 108,327 euros seen at the beginning of 2013. The Government will make a similar presentation in Helsinki, with the aim of attracting buyers from Scandinavia and Russia. PP The Valencian Government believes that foreign homeownership can reactivate economic activity in the region. According to their calculations, this business has moved 4,000 million euros in the last three years.



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05 Jun 2013 22:36 by I_Love_javea Star rating in Gibraltar / Morocco .... 125 posts Send private message

 ROFLMFAO

When will the spanish get there heads out of the sand. I looked at three bedroom apartment this morning in Javea between Puerto and Pueblo being offered at 48,000€ by a bank. A friend of mine has apartment in same block that he paid 173,000€ with 120% mortgage from the defunct CAM six years ago!



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06 Jun 2013 08:57 by baz1946 Star rating. 2230 posts Send private message

This May the cheapest 1 bed bungalow i saw was for sale at 26,000€, (approx  £22,400 ) and it didnt look to bad either.

 





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06 Jun 2013 10:16 by Roly2 Star rating in Almeria. 648 posts Send private message

Yes, the bank prices are really, really low.   And of course we don't know what they actually go for.  If someone submits a petition to the bank (an intent to buy), it is likely to be below the bank asking price.   The property then goes off the market as far as I can gather and we lose track of what happens to it!    There are certainly decent apartments going for around 20000 through the banks, and let's be honest, you would pay that for a car!!!    Can you lose?   I don't think so - as long as you know the area and want to USE it or live in it. 





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06 Jun 2013 12:46 by I_Love_javea Star rating in Gibraltar / Morocco .... 125 posts Send private message

 Long term rentals for 3 bed apartments in Javea Puerto can be had for €300 per month now, that is 3,600 per annum, less costs etc. makes apartments at 48,000€ still way over priced!



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06 Jun 2013 13:01 by Roly2 Star rating in Almeria. 648 posts Send private message

 Yes that is true.   But ownership is deeply ingrained in we Brits!!!





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07 Jun 2013 10:18 by mac75 Star rating in Valencia. 412 posts Send private message

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 Why exactly is 48,000 euros still way over priced ? I don't know the property but a 3 bed in Javea Puerto, it doesn't sound expensive irrespective of the rental price...



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07 Jun 2013 10:46 by I_Love_javea Star rating in Gibraltar / Morocco .... 125 posts Send private message

 Because I say it is!



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07 Jun 2013 10:56 by mac75 Star rating in Valencia. 412 posts Send private message

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 OK.... That make more sense now. Appreciate your valuable contribution :)



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07 Jun 2013 10:58 by I_Love_javea Star rating in Gibraltar / Morocco .... 125 posts Send private message

 My pleasure



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07 Jun 2013 11:39 by elaineG Star rating in Spain . 409 posts Send private message

Long term rentals for 3 bed apartments in Javea Puerto can be had for €300 per month now, that is 3,600 per annum, less costs etc. makes apartments at 48,000€ still way over priced! 

 

3,600 is 7.5% of 48,000, so maybe a lot better long term than 'investing' in a bank





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07 Jun 2013 11:55 by I_Love_javea Star rating in Gibraltar / Morocco .... 125 posts Send private message

Too basic.

If you have mortgage you must take off associated costs and interests.

Buying costs 10 - 12% on top of price.

Yearly running costs and maintenance costs.

You have to pay tax on rental income.

Buy-to-let you need to make minimum of 10% on yearly rental income and that is on full occupancy. Here in Javea there are over 3,700 apartments empty and up for rent.

 

 



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07 Jun 2013 13:28 by baz1946 Star rating. 2230 posts Send private message

Too basic.

If you have mortgage you must take off associated costs and interests.

Buying costs 10 - 12% on top of price.

Yearly running costs and maintenance costs.

You have to pay tax on rental income.

Buy-to-let you need to make minimum of 10% on yearly rental income and that is on full occupancy. Here in Javea there are over 3,700 apartments empty and up for rent.

Buy the apartment that you say is for sale at 48,000€ , for the sake of argument lets say on a mortgage of 25 years, which would / could cost you somewhere in the region of 3,840€ per year depending on what interest rate you get,  my figures are basic. Suma to pay, electric to pay, water to pay, house insurance to pay, maintenance to do.

Rent you say in Javea for 3,600€.....240€ less a year in rent then perhaps buying.  Suma to pay,  electric to pay,  water to pay, maybe house insurance? at least contents, still have to do some sort of maintenance to keep the place in decent order.

Renting...has the chance of being thrown out, sold under you, rent going up....cost of renting for 25 years = 90,000€,  walk away after 25 years with nothing.

Buying...keep up payments and a good chance of staying put, mortgage going up....cost of buying for 25 years = 96,000€,...approx, and a good chance of selling at a vast profit should prices increase. But even if you sell at the original price you paid you still MIGHT walk away with a saving of 48,000€ approx. 

 





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07 Jun 2013 14:03 by I_Love_javea Star rating in Gibraltar / Morocco .... 125 posts Send private message

 Looks like you have talked yourself into a purchase then! Good luck, I will not be replying more to this thread, ** EDITED - Inciting **

This forum desperatly needs some young bloods!

 

 


This message was last edited by eos_moderators on 07/06/2013.

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07 Jun 2013 14:37 by baz1946 Star rating. 2230 posts Send private message

Looks like you have talked yourself into a purchase then! Good luck, I will not be replying more to this thread, as usual suspects have hijacked it!

This forum desperatly needs some young bloods!

No i haven't talked myself into any house purchase,  i have always bought my house's, i  never rented one in my life,in Spain or the UK, if you want to rent then fine, i just happen to think that renting in the long term can be a bit of a loss leader against buying property.

I can only guess that by calling posters "suspects" this must be your way of a cover up for your own failings in seeing whats black and white and looking at the bigger picture apart from your own well thought out correct opinions.





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07 Jun 2013 15:11 by Roly2 Star rating in Almeria. 648 posts Send private message

 Not to be argumentative but I thought that was a bit offensive as well.  Usual suspects?

Anyway, I agree re buying - good or bad investment I have always preferred to own my own home in whichever country I have lived in (or holidayed in).    I like to think it will form part of my estate - so I am less interested in capital gain for myself.





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07 Jun 2013 15:30 by bobaol Star rating. 2256 posts Send private message

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 Back on subject:

So, house prices around Torrevieja have jumped 3%?  Since they fell by some 50% (more in some places) this sudden leap means that they have only fallen 47%.  Pretty good investment all round, then.

I do, however, agree with buying if it is going to be a home.  Renting is fine for short visits, say a couple of times of year.  It gives you the flexibility to move places, try new areas and so on.  Let's face it, property prices are not going to rise much in Spain for the foreseeable future and, probably, not drop by much either (certainly not as much as they have in the last 5 years).  For longer stays, in my case permanent, I much prefer having my own things around me, not being petrified of spilling a glass of vinto tinto on the nice white carpet someone else has put in, going to sleep in my own, comfortable bed and so on.  Being able to get the garden how we want it, able to have visitors when we want to.  

Still, if anybody really, really wants to know the best time to buy or sell just ask me.  So far, I've bought when prices are at the highest and sold when they are at their lowest.  So just ask me when the best time to buy or sell is and then do the exact opposite.  You probably couldn't lose.  





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07 Jun 2013 16:16 by amogles Star rating in El Campello (holiday.... 170 posts Send private message

I have recently bought in El Campello, an area that has always (well, at least in the last 15 years or so) featured above-average property prices and above-average demand. I looked at a very large number of properties through different agents before committing and it was quite clear that there weren't any giveaway bargains to be had in the style that some other areas have been seeing. Even bank foreclosures were scarce and with the exception of some with serious structural defects, sold pretty quickly. In fact there was nothing, however small or simple, for under 80,000 EUR. However, i also interpret that solid base as a good starting point and that it is likely prices in that area will continue to be stable, if not lead the recovery.

Of course I also considered other areas where I could have got a nicer bigger place for half the price, but it was mostly personal reasons that tipped the scales against those places. Other people may not have those reasons for them it makes sense to after those bargains. For me these personal reasons include decent public transport, as I don't like to drive and don't own a car.

Concerning the rental vs buying debate. i'm not convinced that economically, buying is genuinely better than renting. I've rented for most of my life and feel I've done quite well by doing so, for example being able to walk away more easily when neighbourhoods declined or job reasons dictated a change of location. Of course landlords can raise rents when the market rises, but if you're perceived as a good tenant that the landlord wants to keep, you can also reverse that and demand reductions at times when the market is down. I've always led a more nomadic lifestyle than most, and it's been part of my philosophy that my investments should be in such a form that I can sell up and leave when the time comes, and that i should stay out of debt at all costs. The property owning market is very much the opposite of that.

But now I am buying. Why that? Well sometimes its not about money. If you're not an owner, you cannot make all the modifications you want, and I want to live in my ideal house rather than what somebody else considers to be good enough for me. So even though i don't fully beleive this to be a sound investment, I'm getting some luxury and some peace back for it. I'm buying a house that is pretty dilapidated as this gives me a chance to rbuild and redesign it according to my crazy dreams and without it costing me a fortune.





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07 Jun 2013 16:29 by elaineG Star rating in Spain . 409 posts Send private message

I should stay out of debt at all costs 

 

What ?

 

just joking





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07 Jun 2013 17:00 by mac75 Star rating in Valencia. 412 posts Send private message

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 Glad the "usual suspects"  have got involved and actually contributed something decent to the thread :)  

As the OP mentioned  - property in Torrevieja is up 3%.  Yes the saving would be 47% as Bobaol says but I think the point here is that they are saying some areas of the coast have already hit rock bottom and are starting to rise and can only go up from now on. Whether this is realistic or not I have no idea I don't know Torrevieja..maybe those living in that area could shed a light on it...



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