Prices Soften As Mortgage Approvals Fall In Lanzarote

Published on 30/06/2008 in Buying Process

Spanish mortgage applicationMortgage approvals in the province of Las Palmas, of which Lanzarote is part, fell by nearly 36% in the first quarter of 2008.  According to figures recently released by Spain’s National Institute of Statistics.  Suggesting that property prices on the island are now likely to follow suit  – despite the fact that tourism is still enjoying an upswing.

The statistics from one of Spain’s most respected official sources reveal that mortgage approvals in the first three months of the year fell from 14,546 in 2007 to 9333 in 2008.  As a weakening domestic economy and growing international pressures all colluded to impact upon the hitherto healthy market for property for sale in Lanzarote.

Historically, Lanzarote has been a firm favourite with overseas investors.  Especially in the UK – thanks to a buoyant, year round tourist trade that provides owners of holiday properties with a reliable rental income for twelve months of the year.

The majority of overseas buyers apply for mortgages locally – in order to take advantage of lower interest rates in the euro zone.  But just as elsewhere island based banks have started to impose tougher lending criteria and conditions.  Whilst also imposing more realistic valuations on vendors – so exerting a downward pressure on price.

Ironically, the island has been enjoying something of a renaissance in tourist terms recently.  With overall foreign visitor numbers rising by 8.7% in the first five months of the year.  But now, property prices on the island look set to head in the other direction.  As more vendors chase fewer buyers.

A straw poll of the islands leading estate agents certainly seems to corroborate this view.  With all of the three largest agencies reporting a growing number of price discounted property coming onto the market.  And a cursory glance at many agents websites tells the same story – as the number of properties reduced in price grows by the week.

According to Nick Ball, editor of leading Lanzarote property portal Lanzarote Guidebook; “There are still buyers out there.  But they are now definitely starting to exercise more caution.  Of the 1500 enquiries we have received to date this year the vast majority have been for lower priced properties such as studios and apartments in the main resorts.  With little interest being shown in anything priced above the €300,000 mark”.

Other local agents, such as Warwick Pemberton of Freedom Properties suggest that Lanzarote is now on the verge of becoming a buyers market. Enabling bolder investors to secure properties at prices way below their previous market valuations.  

Written by: Nick Ball

About the author:Lanzarote Guide Book

Nick Ball is editor of Lanzarote Guidebook – the in depth Lanzarote tourist information website




Right arrow icon Send to friends   Right arrow icon Printer friendly version    Right arrow icon Submit your own article


Comments:

Only registered users can comment on this article. Please Sign In or Register now.

Comment Using Facebook:




Related articles in this category

"Ever Thought of Retiring to Spain?", She Asked

10 Year New Build Property Insurance - Seguro Decenal

2007 – The Outlook for Spanish Property….

4 Ways To Help Your Kids Enjoy Their Spanish Holiday

A Quick Guide to Spain's Autonomous Communities

A Room With A View

Agent Property Sharing Systems Cost You Money

Aparthotels - Touristic Apartment Legal Requirements

Bank Guarantees for Spanish Off Plan Developments

Being a Film Set Extra in Alicante

Bored In Spain? Not The Spanish

Breach of Contract - Off Plan Success Story

Building Defects in New Properties

Bullfighting in Spain - On its Last Legs?

Buy Property Safely In Spain...NOT!

Buying a Property in Spain - 10 Points to Consider

Buying a Property in Spain - The Private Contract

Buying A Property in Spain Just Got Safer - And Much More Affordable!

Cave Houses in Spain - ADSL Included!

Completing a new property purchase

Consumer Law - Abusive Clauses In Your Contract

Costa Brava Holiday Ideas

Currency Exchange from Sterling to Euros

Deadly Secrets And Those Books About Spain

Decreto 218 - What It Is And How It Affects Buying Property In Andalucia

Deposit Contract

Dispelling The Myths Of What Is And Isn’t A Snagging Defect And Some Amusing Responses From Builders

DIY snagging - Some pointers on how to ‘Do-It-Yourself’

Do Not Move to Spain if…..

Documento Informativo Abreviado. Brief Informative Document (DIA)

Don't Blame Spain

Don't Criticise the Junta's Actions, Only the Delay in Implementing Them

Eco-Friendly Holidays

Financial And Currency Overview - 2012

Furnishing your Off-Plan

Getting Planning Permission in Spain

Getting The Best Euro Exchange Rate

Help! I'm Busy But Poor!

How to Choose an Architect in Spain

How To Spot The Timeshare Fraudsters

In Times Of Recession Some Imagination Is Needed - Option To Buy

Is Anyone Still Moving To Spain?

Is Disney Coming to Spain? That'll be No.

Is it Dangerous to Buy Property in Spain?

Is Spanish Residential Construction Showing Signs of Recovery?

Is There More To Spanish Wines Than Just Rioja?

It Is Possible Not To Pay Enough For A Property - According To The Tax Man!

It's a Buyer's Market

It's A Good Time To Start Selling Property in Spain

Licence of First Occupation and Completion

Mallorca Property - The Cost Of Buying Explained

More on Consumer Rights When Buying a Property

Most Commonly Asked Questions on Completions and Snagging Inspections

Must Have Common Spanish Phrases To Spice Up Your Spanish

New Regulations Protecting Spanish Property Buyers

No Money? No Problem!

Off Plan Consumer Rights - Sample Purchase Contract

Paramount Theme Park In Murcia - What You Need To Know

Prices Soften As Mortgage Approvals Fall In Lanzarote

Private Purchase Contract - Resale Property

Problems Found by Residential Surveyors in Spain

Property Management - Who Needs It?

Publicity - Part Of The Contract

Real Problems Buying Property in Spain

Result Of Building Standards Survey

Snagging Horror Stories

Snagging Trends & Analysis

So, you want to sell your off plan?

Spain Top Choice for Second Home Abroad

Spain, a Gone Conclusion

Spanish Property Market Stalls On Exchange Rate Strength

Spanish Property Valuations - Confused?

Stimulating The Spanish Property Market – Please Take Note Mr. Zapatero

Taking Better Pictures of Your Property

Taking The Developer To Court - Jan's Story

The art of a successful Snag

The Beginner's Guide to Snagging

The Death Of The Spanish Estate Agent

The Do's And Don'ts Of Buying A Mobile Home In Spain

The Euro - Looking Back and Looking Forward

The Licensing Process For Off Plan Properties In Spain

The Mystery of Spanish Property Online

The Other Side of the Coin

The Right Groups’ – The Costs of Buying in Spain

The Rights Group’s Guide to Buying a Property in Spain

The Spanish Property Crash – Was This What Was Really Happening?

Time to Complete

Time to Complete? - Part 2

Top 10 Reasons To Buy In Spain

Top 3 Budget Restaurants In Central Madrid

Try Before You Buy

Try Before You Buy - A Change In The Property Market

What to do Before and After You Complete on Your New Property

What You Need To Do If Your Spanish Developer Goes Bust?

What's In Store For Spanish Property In 2011?

Where Are All The Property Bargains In Spain?

Who Is REALLY Looking After Your Interest In Spain?

Why Buy On A Golf Resort?

Why Buy Property On A Resort

Why Choose Interest Only For Your Spanish Mortgage

Why You Need a Website To Market Your Rental Property

Click here for a list of all the articles from our magazine 

Spain insurance services


This site uses cookies. By continuing to browse you are agreeing to our use of cookies. More information here. x