THE spectacular and seeming never-ending rise in property prices in the province of Malaga over many years is fast becoming a thing of the past. Statistics published recently by the Ministry for Housing reveal a clear tendency for excess supply and decreased demand, resulting in a lowering of prices. For the first time since the middle of 2001, house-price increase has remained below the psychologically significant two-digit figure, registering an increase of 9.8 per cent. Property prices, which have been rising constantly higher and higher over past years, are now decelerating for the first time in decades. Fear that the property bubble is about to burst is frightening away investors anxious to make a fast profit.

http://www.surinenglish.com/noticias.php?Noticia=9541

http://www.thisismoney.co.uk/mortgages/art...mp;in_page_id=8

http://www.surinenglish.com/noticias.php?Noticia=9540

Yes you are right a 9.8% rise.....definite crash

From what friends have been seeing recently in the Almeria area demand has increased substantialy over the past few months. Capital Gains being slashed is a big pull as well as German interest suddenly appearing again. If we have the cold winter we've been promised in the UK then I can see demand being as high as 2002/2003 next year.

Admitted there was a slowdown in 2005 and the market was showing signs of a slowdown but 2006 apparently has been extremely bouyant.

It is quite bad to be in continous denial.

" The alarm has been raised by a property sector report put out by the University of Barcelona recently, in which we are told that the price of an average property in Spain will drop by 20 per cent during the period 2007-2009"

Did you read this part or you read only what is good for you? The Spanish property market will fall like a rock in the next years, the 2006 prices will not be reached again
before 2025!

Yes I'd like to see a 20% drop but it is unlikely to happen. Although I would add that 20% would take it back to 2005 price levels and does not equate to "dropping like a rock" in my book.

If you take a look at property prices on the Costas you'll see that they have never dropped (not even in 89-93)and I personally dont think they ever will. Dont get me wrong there will be an increase in choice and you will always be able to negotiate a reduction on asking price but certainly no massive price drop.

If I was you Catara I wouldnt sit around on your hands waiting for the prices to "fall like a rock". Get in there now and you may find you can negotiate the price you want to pay. That is if you are still desperate to move to Spain.

I am not at all desperate to move to Spain (I do not plan to move in the next 30 years). I would have liked to have a holiday home in Fuerteventura but I can wait for a possible crash. If there is no crash, I can always rent an apartment or a villa.

Or can always visit our friend dogbox in Saidia.

I witness daily the enthusiasm of capital held by the foolish being diverted via the pension sipp to offplan spanish property, the capital is chasing historic gains which may not be part of the future in a similar fashion to the tech bubble isa investor who found themselves with a £600 isa after investing £7000. I think the problem in spain will be excessive inventory wildly out of kilter with dwindling prospective buyers.

Times today.

http://business.timesonline.co.uk/article/...2453459,00.html

Another high profile arrest in Marbella this week, wasn't there?

Nice find spanman! Hope you are still making waves in your area.

btp

I agree with everything in that Times article Spanman. There is indeed an oversupply in some areas and certainly inland properties and those in less desirable areas are completely overpriced (Costa Blanca anyone!!!). People are now even considering paying 100k euros+ for property in Morocco they are so desperate.

The Spanish Developers are greedy, I dont blame them but they are buying up land 5 miles inland from resorts and building apartments expecting to sell them for beachfront prices. For the sake of the Spanish market I hope these properties drop by 40%+. Places such as Albox are still demanding prices of 150k euros+ for renovated farms 30 miles inland. This is crazy, absolutely stupid prices, these fincas should be available for 80k euros at the most.

On the other hand properties within 5 mins walking distance of the beach, in nicer low rise areas and less than an hour from the airport will remain stable.

You must be joking. I'm a spanish real estate lawyer and prices fell like a rock (as much as 40% in some cases) between 1989-1993. Your claim "prices never fell (not even in 89-93)" is completely far-fetched. Real estate falls, claiming the contrary is a fallacy if not tantamount to having some vested interest.

Prices are falling now on the costas and will continue to do so in the next years as it always has happened when the real estate boom cycle is over.

That 9% rise is totally unrealistic and takes into a count a median average of prices inland which only us spaniards (and south american inmmigrants) buy.

This is an interesting paper written by the Directorate of economics in Spain. http://www.bde.es/informes/be/boleco/2006jul/art4.pdf


A friends parents have had a villa on the outskirts of Puerto Banus for close on 25 years. In their experience even though prices were falling in other areas of Spain the popular areas on the Costas were rising at around 7% per annum. Granted the starting prices were in the £30k region in 1983 and rising by about £2k - £4k a year but by 1994 they were up in the high £70k region. Of course by 2004 his villa was worth £400k. Not dissimilar to the UK rises except there was no dip in prices at any point during the 25 years.

Of course if you could point me to some official looking graph displaying this I could back up these personal experiences but alas I can't. I therefore can only hold my hands up and say I cannot confirm my opinions with solid fact.

If you had read my post I never denied that prices are indeed dropping off in some parts of the Costas. I hope this correction allows the young Spanish to buy again in these more desirable areas rather than having to endure life in inland villages and towns. I know from your previous posts that this is your problem with the high prices in Spanish Property and do honestly sympathise with the House Price Inflation that Brits have brought to your shores.

When I said that the fraud started in Spain, you disagreed with me... Dump renovated farms 30 miles inland are not better or worse than dump places like Saidia... The fraud is similar.

I agree with you to an extent Catara. Although fraud is rather an OTT description because these people are buying with their eyes wide open.

There is some fraud that goes on in Spain though, but it is the same everywhere else and would be at a similar level in the UK if people lowered their guard as much as they do when buying abroad.

I'm starting to believe that a drop in prices in Spain may be good for the country. I definitely think that many parts of the Costas are overvalued and overdeveloped and hopefully if prices drop the development will slow down. It is growing phenominally though.

In the Costa Almeria they have built a fantastic brand new motorway that runs from Cartagena (Murcia Airport) to Vera. It has taken about a year to complete. BMI have just opened a new daily route from Birmingham to Murcia and Easyjet have increased their daily journeys to Almeria. It is all getting a bit overcrowded now even in those areas you felt may have been left to evolve naturally.

25 Kts on the plane sin problema.

Just got to get the parking bit sorted out!!!

catara - wow you really do hate saidia dont you?

just out of interest - are you male or female?

Please respect our agreement of ignoring each other.

LOL!! Well you're not mature thats for sure!

They're easier to park when you slow down that lever has progressive settings you know, it isn't just on/off.

Watch out for Pirates!

btp

Lever?

Legal pirates here------ Guardia Civil!!!!!!

Back on topic,
This weeks nails in the coffin lid;


The judge in charge of a Coín court has ordered work to stop on nearly 450 properties spread over nine developments in the municipality of Tolox, following a case filed by the Environment section of the Public Prosecution Department regarding alleged irregularities in the re-zoning of the land.
These 448 properties add to the 2,000 homes, also in Tolox, blocked by the same court in June.


http://www.surinenglish.com/noticias.php?Noticia=9583


Pull them down. That is the solution defended by Environment Public Prosecutors all over Spain when it comes to illegal properties. The coordinator of the Planning and Environment Section at the Public Prosecution Ministry in Malaga, Juan Calvo-Rubio, claims that the authority is stepping up its demands for demolition in the province of Malaga. However he adds that judges are reluctant to adopt such drastic measures, especially if the property in question is inhabited. Marbella, where it is calculated that there are more than 23,000 illegal properties, would be the most affected area.
On the Costa del Sol and in the Axarquía region alone it is thought that there are more than 40,000 homes in this situation.

http://www.surinenglish.com/noticias.php?Noticia=9582


Two houses in El Palmar and another in Los Caños de Meca are facing imminent demolition because they have been built illegally and invade land belonging to the Junta de Andalucía. The announcement was made by the regional government's Environmental minister, Fuensanta Coves, earlier this week, and she asked for the local councils' cooperation in the matter. Both Antonio Verdú, the mayor of Vejer, and his counterpart in Barbate, Juan Manuel de Jesús, expressed their approval of the decision to demolish the properties, and said that the Junta was acting properly. Not all the houses in El Palmar are on protected land, but the mayor of Vejer warned that neither have they been built legally and something will have to be done about them sooner or later, while Juan Manuel de Jesús also explained that Barbate's Town Planning department is dealing with hundreds of cases of illegal housing.

http://www.cadiznews.co.uk/info2.cfm?info_id=24364

And Malaya continues to widen the net.
Bad property press almost daily now.

I think the article in Sur is absolutely absurd. Do you really expect me to believe that house prices on the CDS have increased by almost 10% in 2006? I don't care who produces those statistics -they are nonsense.
Back in the real world it is generally acknowledged that the market peaked 2002/2003. Since then prices have only been going one way, and that is down.
Look at the resale market -most of the housing stock that is currently for sale has been on the market for over two years. I don't care if people are still asking the same prices for property, if they were worth that much they would have been sold by now.
The governor of the Bank of Spain said recently that house prices are roughly 30% overvalued. Some people are begining to come to terms with the fact that their house isn't worth what they thought it was and reducing prices. I've been looking at one villa near Estepona that was reduced by 10%, and then another 10% and still no takers. I'm hearing in Sotogrande that the few villas that are actually being sold are going for between 30-40% below their asking price...
& as concerns the new housing stock, tens of thousands of brand new apartments stand empty and unsold around Estepona -I don't see these prices going up and I don't see how that would be possible anyway with supply far outstriping demand. ( Obviously the only reason that these buildings are still going up is due to the billions of Euros that arrive in Spain every year, the money laudering capital of Europe -ref "White Whale" case)
I don't blame estate agents for talking the market up -it's their job -but to accept these statistics at face value is beyond naive.
(How can they reliably compile these stats anyway with all the black money distorting the true selling prices?)

Welcome FF, you`re largely among like minded friends here.

Absolute rubbish.

Property is still selling strongly in the Spanish Costas. Of course certain less popular areas may have resale properties sticking but that happens in every country in the World. Costa Del Sol has seen a less rampant 10% increase this year after around 16% in 2005.

There are very simple explanations why Spanman, Catara and Forestfire are pretending things are in trouble in Spain.

DRAKAN - He is Spanish and talks on this forum in very bitter tones about how the British buying on the costas have outpriced many Spanish locals. It is obvious that this drives him to pray that one day the prices will crash. Unfortuantely even a 30% crash would bring prices in line with 2003 prices, not enough to allow locals back into the market.

CATARA - Been looking for some time to buy in the Canary Islands but thinks it is too expensive (waiting for the crash). Now looking into Cape Verde as he is sick of waiting for Spanish property prices to come down.

FORESTFIRE - Gives it away when he says "I've been looking at one villa near Estepona that was reduced by 10%, and then another 10% and still no takers". Why would you be looking at villas if you arent thinking of buying? My guess is that you have been wanting to buy for some time but unfortunately cannot afford it. This has got you angry especially when you are looking around and seeing empty properties but Spanish Property prices still increasing every year. I would say the reason you haven't bought into the Villa in Sotogrande is because it is probably still out of your price range even though it has dropped by 20% (the owner or agent probably added 25% to the valuation nayway as is common practise in Spain).

It's not looking good for you guys. Of course there is always Morocco, Cape Verde, Turkey, Bulgaria and Romania for those who cannot afford Spain, may be you should look to these places instead of trying to talk down Spain to your level.

Dude - are you still trying to sell that property?

Why not just stick the link in your sig?

btp

As I already posted I suspect you have some vested interest Adi Brown.

If property sales are still going on strong at the costas, why have so many estate agencies gone bust ? Why have large british real estate agencies fired hundreds of agents during these last two years ? Why have so many businesses property-related closed down ? Why are developers going bust ? Why are developers reducing the prices of their housing units ? Why are developers offering the highest commissions ever to estate agents to sell their off-plan units ? Because there is a huge over-supply of housing units and there is hardly any demand to sustain it. The property boom in Spain has been going on for almost a decade now, it couldn't continue for ever.

I already own property I am not interested in prices going down but they will as they have always done at the end of a construction cycle. Newspaper Sur is full of property advertisements so they have a huge vested interest in publishing that prices have gone up 10% in 2006 (I wish) I had a friend working for them. The truth is that prices are moving downwards since 2004 more specially so in the costas area where foreigners buy property as an investment. This is completely undeniable and any professional in our sector (=property) in Spain can confirm you this; trying to rebut this is absurd. The looming crash still has not happened but will do. No one knows how much prices are going to fall this time round although it is sure this will happen (20 % ? 30% ?).

I repeat my post:

You must be joking. I'm a spanish real estate lawyer and prices fell like a rock (as much as 40% in some cases) between 1989-1993. Your claim "prices never fell (not even in 89-93)" is completely far-fetched. Real estate falls, claiming the contrary is a fallacy if not tantamount to having some vested interest.

Prices are falling now on the costas and will continue to do so in the next years as it always has happened when the real estate boom cycle is over.

That 9% rise is totally unrealistic and takes into a count a median average of prices inland which only us spaniards (and south american inmmigrants) buy.

You already own a property inland which as you say "only Spaniards and South American immigrants buy".

I do sympathise with the situation you are in but I can assure you in my area of Spain the local agencies are recruiting heavily. In fact 2 new agencies have appeared in the local town and certainly no shut downs.

May be I am fooling myself. May be it is some big conspiracy to make me believe that property is still selling strongly. For example two resale houses in my small resort of 40 houses have just been sold in October. A KM down the beach a block of 10 apartments have gone in a few weeks of being on the market. A new motorway linking Murcia airport to the resort has just been finished and airlines (easyjet, BMI, Ryanair etc) are putting on twice daily flights now and new routes from provincial airports. Am I dreaming all of this?

My good friend Miguel who is a property lawyer in the local town has mentioned that completions have been rising quite rapidly in the second half of 2006 and that they have already been turning away business for January, February because it is so busy. The general feedback is that a lot of people are moving over to retire rather than buying an "investment". The recent mini boom in the UK has unlocked a lot of people from the market who are wanting to just get out of the UK market and get somewhere for retirement before they find themselves in a situation where they cant sell in the UK and are stuck there.

I'm sure Draken that amongst outpriced Spanish people there is an urgency to grab on to any talk of closures or Developers going bust but I bet most of it is just idle gossip. I have also seen a few fly by night "property shops" on the costas and these close down and then start up all the time and have been doing for the past 25 years. As for Developers going bust may be you could let us know which ones as there will be bargains to be had I am sure.

I can only go by what I see and what I am told by friends in the Industry. In my opinion Spain isn't going crazy at the moment but it is certainly very active and demand seems to still be there.

If investment is your prime driver, Spain is a challenging arena. Why are Spannish developers such as Fadesa and Tassa investing in Morocco?

British through and through old boy!!!

Please link me to any post where I have discussed Brits outpricing locals. I live in an area where there are very few Brits and the local population has outpriced itself.
I`m quite happy renting for the moment as I gain significant tax advantages.


Any other blatant untruths you would like me to correct for you?

Sorry I have already corrected this, I was thinking of Drakan. My apologies.

So you are renting at the moment waiting for prices to drop.......mmmm seems you are another with an interest in prices coming down.



No investment is certainly not my main driver. Investment is only applicable if you are looking to sell which I am not looking to do any time soon.

Unlike 99.9% of people on this area of the forum I am only interested because I like the country and I like having a little home there. Not looking to make any money etc.

Anything is just pure observation from somebody without VI.



You mean this property/site etc ... www.forsaleinspain.com

Domain is for sale, property sold last month.

Sorry to disappoint you BTP.

As I was saying before this property owned by a friend was up for sale and went more or less within a few months for asking price. Another one has also sold in the area last month.

By the way the friend has just bought a larger property about 4 miles down the coast for about 60k euros more. He has kids and it is now nearer there school etc. It was also a resale. The couple in that one have moved to a new build which they bought off plan last year, that development went within 5 weeks of being made available for purchase....beautiful villas though within a minute of the beach...700k euros a piece though.

Yes its definitely all moving along nicely as far as I can see.

This is what you understood, which is not surprising because your level of understanding is not very high.

I am not at all interested in purchasing in Cape Verde, I just went for a visit there. I have been 100 of times to Spain so I am trying to diversify.

You speak as if you have the absolute knowledge of Spain, when is reality you do not have.

No I am quite happy to admit I do not have much idea about the rest of Spain.

Put it like this. You have 100 people move out to Spain. Out of those 100 you have 6 that want to move back to the UK and you have 2 that get ripped off.

On sites like this you will rarely hear from the 92 happy souls in Spain, mainly because they have no reason to be on here. I happened to come across this thread because I was chatting about housepricecrash in the UK. I didn't "invest" in Spain and I have never "flipped" a property, I merely bought a house to visit in Spain and may be live permenantly in one day.

Anyway out of the 6 that move back you do find this "Spain is crap thats why I moved back" mentality and as a cathartic response they will pick up on any negatives. These people tend to spend a unhealthy amount of time on forums. There was a couple on here and if I remember rightly the nonsense spread from "It is warmer in the UK than Spain in Winter" to "It is cheaper to live in the UK than Spain" and "The mafia are all over the Costas, crime is worse than the UK". The give away was a few things they said which included such classics as "And most of the restaurants tended to serve Spanish food" and "You find things you take for granted such as Pot Noodles etc are more expensive in Spain".

Also 100 people move out but leave behind a group of 100 friends who are not able to do so because prices are too high. We found this, not with our friends but baby boomers around us who had moved out there. There friends either didn't have the balls to move abroad or didnt have the money. They would turn up to visit and point out negatives. It is very sad but it is human nature. A couple we met wanted to live in Spain but when they had got out there had realised prices were unlike "Place in the Sun" prices which were characteristically a year out of date. They didnt want to live inland so were a bit stuck. We felt quite sorry for them. Anyway a few months later they were renting locally and had suddenly become "Spanish house price terrorists". They started listing off a load of stats about developments taking on average a week longer etc to sell and how they were expecting a crash anytime soon. Needless to say we weren't fussed because we couldnt care if prices halved, we hadnt bought for that reason. Anyway they continued going on about it everytime we went out with them and it was starting to affect some of the older people who of course were worried that all these things would affect them in some way. Needless to say that was in 2003 and as far as I know they ae still renting and still ranting about the crash....unfortunately prices are now 40% higher than 2003 so if a crash did happen it would have to be 50-60% for them to afford it.

Whats sad about this is that in actual fact the prices aren't unrealstic as they are in the UK. You can still pick up a 2 bedroom beachfront apartment for £130k or a 3 bedroom detached villa with pool for £200k. Slightly inland you can get a 2 bed apartment for £80k. This is now in 2006 after 10 years of increases. What really pi**es me off is that people are moaning because they still want the £30k apartments and £50k villas but their 3 bed terrace in Preston costs £200,000.

Anyway rant over for now. In conclusion I agree with Catara I do not know anything about the whole of Spain and I am sure that at some point soon the oversupply in some areas will bring prices down across Spain. If I was looking to invest I would look very hard indeed because although the odd developemnt may bring quick riches the majority are going to grow very slowly if at all and especially in overdeveloped areas such as Costa Del Sol and Costa Blanca.

Don't be sorry - I'm very happy for you them.

Just so we get an idea of how quickly property is shifting - how long did it take to sell?

btp

Hello adibrown,
I will answer your speculation directly.
I can afford to buy a villa in Soto, I rented there for a couple of years, but I really don't like the place.
I am looking to buy a place in Spain, I don't deny it.
Your response -"absolute rubbish", well we must either live in different worlds OR more likely you have an agenda.

"Costa Del Sol has seen a less rampant 10% increase this year after around 16% in 2005. "
This is absolute rubbish, I've never heard such propoganda -no-one living on the CDL believes this -I doubt that you do.

At the monthly press conferences of the European Central Bank, the governor, Jean Claude Trichet regularly voices his concern about the state of the Spanish housing market and I would take his word over yours.

I stand by everything I said in my first post as factually accurate.

TBH I think it took a good 7 months to sell, It may have even been a bit longer although it as only really been marketed by a local agency since June/July 2006. I have no doubt that

And BTP it really isn't my property, as I have said before my property is actually being rented long term by a family and has been for the past 2 years.