Interesting reading i received by email today and thought i would share with you all:



Press Release from Conti Financial Services at http://www.mortgagesoverseas.com/
7 July 2008


Spanish property market – dark cloud or silver lining?


Is David Villa, Euro 2008’s top scorer, the only hot property you’re going to find in Spain these days? Some recent media
reports about the Spanish property market
would suggest so.

Simon Conn, Sales & Marketing Director at Conti Financial Services, the UK’s leading overseas mortgage specialist, comments on the current Spanish property market.

Forty-odd years of hurt came to an end for Spain last month when its football team defeated Germany in the Euro 2008 final. After decades of underachievement, Spain rose against the odds and led the country to victory, with its own David Villa crowned top scorer of the tournament. But what can be said about the nation’s property market? Dogged by scandals, oversupply and plunging prices, is the game over for Spanish property?

If some of the recent headlines are to be believed, you shouldn’t touch the Spanish property market with a bargepole. But I think many of these reports are overstated. I’m not denying that there have been problems, but we must look at the bigger picture.

Scandal and saturation
It’s true that cases of corruption leading to illegal building have made buyers nervous – no-one wants to invest in a property which could have been built without the proper planning permission and may be at risk of being demolished. It’s true as well that there is an oversupply of new builds, especially on the Costa del Sol, and this has made many potential buyers think twice.

Credit crunch
We must also consider the credit crunch in the UK, which means British buyers are less willing to invest in another property, but banks too are less willing to allow them to release equity from their homes to do so. Add to this the strength of the euro, which has resulted in property and euro mortgages becoming more expensive, and you may well wonder if there is any upside to the Spanish property market at all!

Tighter criteria
These factors have resulted in some Spanish lenders reviewing their terms – for example some have recently lowered their loan to value ratios - but this is a precautionary measure and could be seen simply as responsible lending.

My advice
My advice to anyone interested in buying a property in Spain, and those already owning property there is – don’t panic! There are many positive aspects to consider and it’s still the number one choice for many.

Buyer’s market
Despite rising costs, buyers are in a strong position due to the volume of properties on offer. Your chances of negotiating a price reduction are also higher. But it pays to be selective – many so called bargains are being offered at knock-down prices because they’re of poor quality and in poor locations. It may be wise to look at re-sales - that way, you can get references from previous buyers and check any other re-sales being offered on the same development. As a result, you’ll get a much better idea of its true market value.

What credit crunch?
Whilst the credit crunch takes its toll in the UK and US, things are different in Spain, which has never been heavily involved in the sub-prime lending market, and families have not stretched their incomes as much.

Spain still popular
Enquiries received by Conti about Spain indicate that things are still strong – it remains a top destination. There’s no doubt, however, that people are becoming choosier. Demand in some areas – notably the more traditional Costas - has declined, but increased in many others. Current hot spots include areas around the big cities like Barcelona, Madrid, Seville and Valencia. The Balearics and the Canary Islands are still attractive to buyers, especially the more exclusive resorts. And this is good news - attractive developments in desirable locations should consolidate their position in the current market, as buyers become more selective, and emerge even stronger when the market comes up again. Also growing in popularity is the Costa de la Luz, between the Portuguese border and Gibraltar – not least because of its wonderful climate, with the area enjoying more sunshine and less rainfall than the Costa del Sol.

New airport
More good news is that permission has been granted for Murcia’s new airport at Corvera to be built. It’s a popular area which benefits from its Mediterranean climate, with the sun shining more than 300 days a year. The project has been promoted by the regional government in Madrid for many years as an alternative to the existing airport at San Javier which draws about two million mainly-British passengers a year to the region. Budget airlines are rumoured to have expressed ‘strong interest’ in the new airport, due to be completed by 2010, and it will benefit from links to several new motorways.

Conclusion
So, what can we conclude from this mixed bag of factors? The Spanish property market is well established and I’ve always maintained that it should be viewed as a long-term investment. Spain will continue to experience problems in areas that have been exposed to corrupt licensing laws and where there are ‘land grab’ issues. Generally speaking, however, I believe that property will continue to increase in value over the long-term and the country still offers the perfect lifestyle opportunity.

Spain is not a high-risk market.


Conti Financial Services is the UK’s leading overseas mortgage specialist. It provides finance for purchasing holiday homes, investment and retirement properties in more than 45 countries, and re-financing for any purpose in 15 of those countries. For more information, please visit www.mortgagesoverseas.com


Notes to Editors


Conti Financial Services Ltd
Conti Financial Services Limited (CFS Ltd) is the UK's leading provider of overseas mortgages with over 225 different mortgage products and is currently linked to 1,000s of independent financial advisers, mortgage specialists, agents & developers worldwide.

For purchases of property overseas, CFS Ltd provide a complete hand-holding service, advising on the most favourable lending rates in the country of interest, and negotiating competitive loan-to-value (LTV) schemes over timescales to suit the client.

CFS Ltd can negotiate loans in more than 45 countries including Andorra, Anguilla, Antigua, Australia, Azores, Bahamas, Balearics, Barbados, Belize, British Virgin Islands, Bulgaria, Canada, Canary Islands, Cape Verde, Cayman Islands, Czech Republic, Cyprus, Dominican Republic, France, Grenada, Germany, Gozo, Hong Kong, Ireland, Israel, Italy, Jamaica, Madeira, Malta, Monaco, Nevis, New Zealand, Poland, Portugal, St Kitts, St Lucia, St Vincent, Sardinia, Singapore, South Africa, Spain, Switzerland, Trinidad & Tobago, Turkey, Turks & Caicos and the USA (special sterling schemes for Florida).

CFS Ltd has teams each specialising in selected countries. Each team consists of mortgage specialists, underwriters and administrators - giving client and lenders consistency whilst dealing with any mortgage application.

Conti Financial Services Limited is an Appointed Representative of Anchor Mortgages Limited, which is authorised by the Financial Services Authority

"Spain is not a high-risk market."
Hilarious hahaha


"The Spanish property market is well established and I’ve always maintained that it should be viewed as a long-term investment."

The Spanish market is medieval in character and anyone who puts the words "Spanish property" and "investment" in the same sentence is not to be taken seriously.

Who is the writer? A salesman selling a product. It's his job to look for positives even if he is spouting total bull.

I'm just waiting for the latest spammer to join the debate to plug his/her websites.
If I get in before him/her -please give us a break. Try paying for an advert like professionals do. Spamming up these forums makes you look like a real amateur.

You might like to check out the economic prospects first.

http://www.rgemonitor.com/euro-monitor/252...o_cruz_syndrome

Hi Forestfire

I know from previous posts that you currently rent in Spain after trying to buy there last year but the EA inexplicably raised the price on your dream villa at the last minute.

I believe you have a vested interest in talking the market down in Spain as much as others on here have an interest in talking the market up. Correct me if I am wrong but you like Spain, indeed you love Spain, you covet a little villa by the beach that is your own villa and not rented. You even said in one post:



You now find yourself in a position were you have been renting in Spain for over a year waiting for the prices to drop and not just that but you cant sell your house in Lincoln that has been on the market for two years (according to your past posts). What an injustice. The prices aren't going down quick enough for you and to compound it all your losing money on your house in the UK!!!

So you spend your days going on forums and telling people how horrible and corrupt Spain is. You flick through page after page of websites trying to find ammunition. After all the more people you put off the more chance prices will come down and the more likely it will be that you will be able to buy a villa for less when you finally sell that bleedin house in Lincoln and get out of your Spanish rented property.

You see what doesn't cut it for me is this constant digging at Spain yet you choose to rent there. If it was so awful why not rent somewhere else? You are renting after all. Why not rent in France or Italy or Lincoln?

What the most amusing thing about all of this is is that MarkinSpain is doing exactly the same thing. He is also renting in Spain and waiting for prices to drop. He has exactly the same vested interest in coming on here and constantly talking Spain down.

There is no doubt house prices are dropping in Spain as they are in Europe, in fact the whole World. The Spanish Costas are long established and desirable areas to holiday and live. The dangerous areas are Bulgaria/Morocco/Romania/Cape Verde where anything could happen. History has shown us that Spain is and is likely to continue to be a safe long term investment. What Conte wrote simply reflects this common sense economic reality.

I googled and the first link i read said

http://www.eitb24.com/new/en/B24_105719/po...Spanish-crisis/

"The prime minister finally used the word "crisis" on July 8 as more and more data showed Spain was being pummelled by the collapse of its housing boom, the global credit crunch and soaring fuel prices.

Economy Minister Pedro Solbes last week said Spain faced the most complex crisis in its history after over half a dozen property and construction firms collapsed.

Spain's debt default rate has doubled to 1.5 percent in the past 12 months and analysts see it reaching 4 percent by late 2009 after the heaviest period of borrowing in the country's history.

Unemployment is thought to have reached 10 percent in the second quarter, according to a Reuters poll, and some analysts see it hitting 15 percent by late next year."

Things are not looking so good according to the government.

Clever boy.

It's good this internet aint it?

I dont think anybody is denying that a crisis is unfolding across economies Worldwide and in fact Spain is particularly affected on a macro scale due to its exposure to construction. I also believe that too many houses/flats have been built and there is an oversupply in parts of the Costas.

What interests me is the way it affects British people living at the moment in Spain and those looking to buy property in Spain.

As far as I can see it has very little effect unless you are a) An investor/flipper who gambled on the wrong properties A desperate seller, ex pats looking to return due to personal problems/circumstances c) Somebody who requires a large Spanish Mortgage to purchase

In my experience those looking to buy in Spain are mainly cash buyers (retired/cash rich/criminals). Recently a surge in cheap apartments and villas has happened in order to supply a surge in demand by MEW'ers and poor people requiring Euro mortgages. These low quality developments have sprung up in areas such as Murcia, Costa de Luz, Torrevieja, Valencia, Motril etc usually inland and on land that was worth pennies. The well known company driving this is Polaris World who buy up these cheap plots and, build a cheap golf course and then charge silly amounts for flats built around this golf course. No thought is put into the fact that it is scrubland 50 miles inland and the Brits were lambs to the slaughter. These developments will stop and this type of buyer in Spain will cease to exist in two years time. The apartments value will drop to the floor and this type of development will stop.

Anyway what I am trying to say is how will high unemployment affect joe bloggs looking to retire to Spain. In my opinion all of this will make very little difference and the people I am talking to that live out there indicate that very little has chnaged over the past few years. Everything is normal contrary to what you read in the papers....the rioja still flows and the sun still shines.

Wrong as stated in the other post, I own two properties here outright so I definitely have no interest in prices going down. What is amusing Einstein71 is that you come on here making statements and allegations that are incorrect. You won´t accept that nobody is buying and even those who want to cannot get the finance. You supposedly speak Spanish so take some time to have a look at www.burbuja.info to find out what is really happening.

There is a world wide problem but there is a massive "but" to that.

Here in Finland although the forestry/paper industry is falling on hard times and one or two construction suppliers are not doing so well there is no sense of doom and gloom and indeed so many firms are still doing well that you have to wonder if a house price correction will ever come. Wages are rising very fast and inflation is highish so maybe no fall in nominal prices will occur? Finns are surprisingly techologically and engineeringly competant. Porsche boxsters and caymans are made here until 2011? And then a hybrid electric sports car will be made at the same factory. Many firms here are world leaders in their various areas be it lifts or cranes or cruise ship systems and only with a population of 5 million

Norway and Sweden are doing ok. The Baltics and denmark are not doing well. Poland is doing ok. Germany Ok but slowing. France is beginning to struggle. Russia has high inflation and has to reign that in and that is what is saving many parts of Europe so far.

As you go further south or to Ireland or west it gets worse

Spain appears to be a total basket case right now - only the USA seems worse in the west. Without ECB support in exchange for Spanish and other european mortgages there would be more or less no lending in Spain now. And nothing is getting better. So the least developed most indebted most bubbled countries are in for plenty more pain.

European rates are still rising. And somewhat ominously. There is no way to spin this to sound good as it will only get worse before it gets better.

Arguably Spain is just ahead of the pack and that kind of pain awaits most of us? Even so it seems clear that Spain is in a pretty bad mess right now.

The scary aspect of this is that money is becoming harder and harder to come by in a general sense and with high inflation there is no way to avoid higher rates - just none at all. I dont think people grasp that aspect of the current situation. Money was too cheap and now reality has arrived. Bit by bit it is coming.

http://www.bloomberg.com/apps/cbuilder?ticker1=EUSOC:IND

If 500,000 brits have property in Spain and similar numbers i guess come from other northern european countries there are factors at play here that will all work together before this gets any better.

Your misinterpreting my post.

I quite agree that Spain is economically weak at the moment and unemployment high, lending stopped almost completely and empty flats everywhere in certain developments.

My question is how does this affect a cash buying retiree looking to move to Spain? Only in a positive way in my opinion. More choice, more likely to get an offer accepted, higher return on savings etc. It only becomes an issue if you decide to return to the UK within a few years of emigrating to Spain. This affects about 1 in 20 (beer mat calculation).

The day to day living is no different to 2, 3, 5, 10 years ago. OK so the investors have fled, the MEW'ing masses have disappeared but these people only really came on the scene in 2001/2002. In a mad 5 years Spain went building crazy and it will take some years for it to recover but I have no doubt it will, but that is just my opinion.

What is complex about the over building is that when you take a closer look you realise that it is only certain types of developments. Certain areas have it bad and those that are struggling to sell are doing so en masse in some cases within communities built to attract investors/flippers or poorer people. So there are issues in Albox and Torrevieja for example that were marketed to the UK poor (via expos in places like Hull, Leeds, Stoke, Cardiff) and many mortgaged/mew'ed to purchase. Inland areas of Costa Blanca and Costa Almeria as well as Costa De Luz. Although a cash rich retiree can pick up bargains in these areas now as distressed buyers are plentiful the unfortunate reality is that your cash rich retiree will not find these places desirable.

I'll accept that volume of sales has decreased by about 70%. This is all the flippers/investors and MEW'ers that have now disappeared along with the cheap credit. A certain type of development was being built for these people and that development has now stopped almost completely. This is great news for those living or moving to Spain to live. That is my point. If you are investing abroad stay away from Spain, if you are looking to retire somewhere now is just as good a time as any to do so. Good amount of property and possible bargains.

Spain has been building beyond demand for some years now. What is happening at the moment is the greedy developers are getting a beating, for some, ,perhaps most, a fatal beating. Lessons will be learnt and construction will almost stop completely...possibly below demand. For me, a homeowner in Spain this is great news and I can only see things improving. As developers die off new builds stop flooding the market and resales in good areas/developments become more desirable.

If spain is overbuilt then most construction activity will centre on renovation of existing stock as demand requires it. So already a considerable amount of previous economic activity is no longer required and will not be required for years and years to come.

The unknown here is the degree of price fall that will be necessary to restablish a normal market. Since there is a world wide dynamic at work here then the ability of overseas buyers to move to Spain will be reduced also. Meanwhile all of the debt remains in the economy and that too will take years to work thru. Seems like a lot of headaches and some good reasons to expect further price falls.

What about social stability and so forth? One moment Spain is rocketed into a consumer society and the next it is plunging back to a simpler by gone era - or so it seems from the outside. From an outsiders viewpoint these things take a while to come visible and clear as to what happens next. Better to wait for stability before investing would be my view. It will take a while to play out so what is the hurry?

Just one example of market reality.

Las tasaciones de vivienda caen un 21% en el segundo trimestre del año.

The number of property valuations falls 21% in the second quarter of the year.

Full article in Spanish.

http://www.eleconomista.es/construccion-in...re-del-ano.html

I think I agreed that the construction industry and developers are in dire straits, no doubt about this. For those retiring to Spain the reduction in new builds is a huge positive. If anything the construction boom was a real pain for those either with property already or those looking to buy. As you rightly state the industry will now stop building and simply try and offload developments in progress. It may be that developers will have to work harder on pre existing developments to try and attract buyers....shoddy quality and half finished amenities will no longer cut it. By reducing building work in fact by stopping it dead you also reduce the negative effects that came with it such as increased traffic, overburdened local amenities, overcrowded beaches, resentment by locals, dust, dirt and general destruction of local landscape/countryside etc.

The social effects in my opinion will be unnoticeable. I certainly didn't notice too much change in my local community during 2001-2007 so doubt that I will notice much change in the coming years. Time moves very slowly in Spain. People still shop in markets and enjoy the simple pleasures in life. I remember getting my laptop out in 2002 and attracting a crowd of locals. These people dont MEW most of them don't even have mortgages they still live in houses passed down from generations. Costa Almeria where my house is is primarily a farming region, it grows a lot of avocados, tomatoes, aubergines, peppers etc for a Western market that demands these products all year round. As food prices increase the local people if anything will feel possibly slightly richer. The local construction industry uses a lot of contracted Eastern European labour and my sources tell me that as the work drys up these guys are heading home. The local economy may lose some money but the labourers were sending most of their money home and very little was spent in town.
The biggest effect I felt on the local community was an increase in Brits which hopefully will now slow right down.

I fully agree about not hurrying into anything. There are a lot of poor developments in Spain and quite a few desperate Estate Agents/Shysters (some visit this site). Spain is great if you choose the right area and what might be my right area might not be your right area and so just have fun findng it. Rent for a time and visit places by yourself (without any annoying EA or Selling agent). It isnt the right time to be investing in property anywhere in the World so if you are looking to make a quick buck then look at another commodity. If you are looking for a nice retirement home, you have cash and you have spent time looking and are 100% then I dont see the harm in making a cheeky offer but Im sure others will say just keep on renting.

Hello Einstein71.
Thank you for taking the trouble to go through all of my previous posts. I would like to put you straight on a couple of assumptions that you have made about me.
Firstly, I have sold my house in Lincoln -thank you very much for your concern though.
Secondly, I can't be bothered to go through all my posts, but I am pretty certain that the "arm biting" post was tongue in cheek.
Thirdly, I am not looking to buy in Spain any more -in fact I am moving away in the near future.
Therefore it will not affect my personal finances whatever happens to the Spanish market. All I can say is what a stroke of luck I had that all of my attempts to buy came to nothing. Had I bought I would be looking to lose several hundred thousand Euros, say 3 years down the road, or however long it takes on average to sell in Spain these days.
I have nothing to gain by talking down the Spanish market, only personal satisfaction if I help better inform a single person from making a naive purchase. By seeking to belittle my posts it is clear that you have a vested interest in promoting the Spanish property market. I don't envy you -that must be such hard work these days



Here's an article I found the other day, just in case anyone was thinking of buying in Spain in the foreseeable future:
http://www.surinenglish.com/20080724/news/...0807241301.html

Spain has no desire to improve it's image and put the corruption behind it.
They will keep grabbing land, knocking down expat villas and swindling British people of their life savings for the foreseeable future. Why? Because there is no justice.

No problem. OK thanks, please go ahead.



Oh thats good news, glad to hear it.



Oh OK. You mentioned you would have bitten my arm off for a 3 bed villa for £200k because where you are in CDS you would have to pay £500k. I took this as a desire to buy a villa in Spain. My mistake.



Yes you have been renting there for a while now. If you dont like it after all that time then that is probably a good idea. Some people love it , some people hate it.



If you had bought the right place you might not have turned bitter, and instead have been looking forward to a fun, relaxing..sometimes challenging life in Spain. Instead it sounds like you are in an unsettled state of flux, no longer happy in Spain, looking to move somewhere else. I only know my area but I dont see any major price drops, some areas I see the drops you talk about but then only in certain developments. Prices may drop, people may lose money but if they decide to move back to the UK prices will have dropped also over there and if they look to buy in Spain again then those losses are inconsequential. The only losers are those looking to buy in Spain for investment...>I wouldnt do this anywhere at the moment.



As a person who attempted to buy but failed and now holds a bitter and twisted view of Spain I would say you are not the most balanced commentator on such matters. Unfortunately the hundreds of thousands that happily succeeded in obtaining a slice of Spain have very little time to sit on their computers offering an alternate view of living in Spain.



I thought that forums were about expressing different opinions. Your posts are from one end of the spectrum and this forum is indeed heavily weighted from that end. I bought a villa in Spain many years ago for cash, that is my vested interest. My gripe is that people come on here and talk about corruption, destruction, doom and gloom but with little more ammo than a link through to a website where a disgruntled minority of expats let rip or a corrupt mayor is charged. My experiences are far from this and my house in Spain has bought me nothing but great joy. The people I know out there actually hope this smear campaign continues because it means smaller queues in the Mercadona and a few spare seats at the local Tapas Bar. I though would also like to be responsible for just one person taking what is said with a pinch of salt and going to Spain and thinking for themselves. Talk to the people you meet and hear what the MAJORITY of people have to say that live out there.



Ahhh I did wonder where the obligotary link to some negative news story was. Read my post above.



Absolute unfounded tosh. Do you know how many expat villas have been knocked down in the past 10 years? How many expats have been directly affected by Land Grab Laws? How many British people have had life savings swindled?

If you can give me figures then I will believe you. I would estimate the answer is less than 50 for each question.

Einstein

Dispite all of your protestations you seem to have some kind of axe to grind here.

Spain like many places seems to have been in a complete state of denial or they have hidden the difficulties they are now going to face as they prepare for the slowdown or want to maintain confidance. It is not just construction as you seem to want to believe. Construction like car production creates a mass of service and production flows in an economy. The cafes the pubs the shops the population itself. All live one way or another based on construction or they will be seriously impacted via its demise. Construction sits on top of a massive pyramid of activity. Take away the top and the next layer down has no economic justification. You mentioned the foreign construction workers who will go home, well they live in newly constructed buildings as do many others who have no economic basis for being in spain other than for construction created spending. It is not just construction spending that will dissapear but a whole system of support for such a massive building program. Meanwhile whole areas have been build and there will be nobody to want to carry on living in them as their economies run down.

No doubt there must be wonderful places to live in Spain but for many difficult times are ahead and it seems a bit unnecessary to me to make out that this is not going to be the case. Perhaps you and your friends will be entirely immune from the troubles and you can benefit from having cheaper house cleaners and better service in restaurants but for many it will not be so kind to them.

You began by poking fun at me that i provided a link that said the government was recognising difficult times ahead and you poke fun at others who provide links.

I am not sure why you felt a need to ridicule me. Evidently you agreed with me later on in other posts and seemed to want to point out continually that you agreed with me so what was the issue?

My issue is that you are wanting to portray buisiness as usual in Spain when all the signals are anything but.

By all means ridicule me again, but what exactly is your point here?

If you say all is well then obviously people are going to point out that all is not well and this will continue ad nauseum and instead of no publicity for spains difficulties there will be endless links to spains difficulties and all driven by your desire to say its a great place to live. How about some links to support that view?

No axe to grind, just putting forwards an opinion which doesn't fit well with many on this forum. I have had personal ties now with Spain for close to 14 years and although I don't get to go out there as often as I would like I am in constant contact with lots and lots of people who do live out there. What annoys me is this constant reference to Spain as if it is on the edge of some doomsday event. You also get lots of people talking of land grab and villa demolition as if it is a daily occurence. In 14 years I have never known anyone to be affected by any of this.



I take it you live out there and see this denial or is it just hearsay? I think Spain is much more open to what is happening with housing and the economy than the UK. The Spanish government has been quite openly discussing difficulties with a degree of honesty missing in UK politics.



Not where my house is. I seriously don't know how many times I have to repeat this but way before construction became a huge industry I visited Spain and the same amount of cafes, shops and restaurants existed as they do today. There was one place that was seen as a bit overpriced but that closed down about 3 years ago. A cheap "Menu del Dia" restaurant charges 5 euros for lunch and 8 for dinner...wine included. Food is quality and rich and poor dine together. In times of boom the rich still dine in these places and in times of recession they will continue to dine there. Life goes on.

Come 6pm the boats come into the harbour and the fish market comes alive. A kilo of gambas roja costs just a euro and will last you a few days. This isn't peasant food and again the clamour for a kilo comes from rich elegant madridlenos on holiday as well as poor sun shrivelled widows. This routine will be unaffected.

Construction labourers in my region (unlike many I can only discuss what I know well) live in a town called Cuevas or hamlets inland were they eat Iahne (a stew) or mamaliga (cornmeal) and very rarely venture out. Some of the labourers Tapas Bars in these areas may be affected but they were generally no go areas and a bit rough. You might find the brothels doing a little less business and the Tabac store. In these cases I agree that the loss will filter down but the very essence, the culture, the music, the food, the beach, the fiestas, the rugged landscape will remain untouched. I think that is what it is difficult to relay to people who assimilate events in Spain with a society on a par with that in the UK. They really are poles apart. Many of the Spanish I know still have TV's that were built before remotes were invented. There evenings are spent sat around a table enjoying food a bit of music and a jug of wine. They dont have wine bars, french restaurants, designer shops, Carribean holidays, Waitrose, private schools etc. If you halved the average income of these guys their day to day activity would remain pretty much the same.

I cannot predict the future but I know that the things I most enjoy about my house in Spain are free and unlikely to be affected in any way by the economic problems in Spain. I cant talk for everyone and I am sure some young Spanish who invested or bought into over priced developments will go bankrupt and that is unfortunate but that is investment risk. Going and living in Spain will be from my experience and knowledge almost entirely unaffected by events.



I dont poke fun I simply go back to the fundamental argument "what effect will this have on cash buyers in Spain?". Providing links stating that Spain has stopped lending and IR's will go up but need to be dropped etc is simply great news for cash rich ex pats. Links that lead to articles about one off corruption charges or Mr Bloggs and his struggle against Spanish Bureaucracy are often used as evidence of widespread corruption or ex pat unhappiness.



If I agree with you I will say I agree with you. Most of your points are valid and I agree with what you are saying. I have to say you appear very switched on about most things. I will disagree with things I disagree with. I dont think I ridicule you any more than I get ridiculed by others on this forum. It is possibly light hearted banter akin to prime ministers question time.



I have constantly made clear in my posts that I believe the Spanish economy to be far from healthy and in a bad way. I think for Mr Smith in his villa by the sea it is very much business as usual. On a macro scale I dont think it is very stable. Im ot sure how this will affect my friends and is at the moment having nothing but positive affects.



Im not ridiculing just disagreeing. My view is that the only Brits affected by all of this debarcle are those that took out huge euro mortgages, those that want to sell and those that bought property for investment. I and my friends bought somewhere to live/holiday and paid cash and as a result are if anything positively affected by everything you mention in this forum that is happening to Spain. We are representative of the majority of UK buyers/residents in Spain.



Why do I have to support my view? I am the primary evidence, all you can provide is secondary and in some cases tertiary evidence. I own a house in Spain, I lived there for a number of years, I speak the language and have probably more than 50 good friends that I have collected in my years of living in that area. These friends stay in touch weekly. I am discussing the effects on people like me. I am not debating the wider economic situation. The best link I could offer would be one linking back to all my posts on Spain.

Einstein, please spare me the amateur psychiatry. You've made a number of assumptions about me that are wrong, and it appears that you've been wide of the mark with other forum members too.
You can of course continue with the personal slants -that's your choice -I don't take offense but prefer myself to stick to the subject matter.

I have lived in Spain for over five years. I do think that it is a good place to holiday, but living here is quite different to spending a few weeks in the sun every now and then.
Spain may be a good place to retire for some, but anyone considering this should take a number of things into consideration. For example, you have to add on 10% to the price of purchase to allow for taxes and other costs. Many agents charge commissions at a far higher level than the UK, and it is often said that in order to not make a loss, prices need to rise 25% from the time you purchased to when you sell. Also bear in mind that when your offspring come to sell your estate, the average time it takes to sell in Spain is over 3 years -that could be quite a headache for whoever is left with the property.

You may rubbish my link -but this is what is shows -On his watch, as Mayor of Marbella, Roca looked on as billions of Euros were laundered on the Costa del Sol. This money was the proceeds of drugs, prostitution and people trafficking. Not only did he look on, he shared in the proceeds. He was found guilty and sentenced to 1 year. He will probably serve far less. This says everything about the Spanish justice.

I arrived at that because from an outsiders viewpoint spain has been grappling with some serious economic issues related to bank lending as a result of the credit crisis. The initial view was that Spains banks were fine and had close relationships in the same way the Nordic banks functioned (I am in Finland) and were able to carry on lending even though the credit markets had seized up. It then transpired that Spanish banks were taking mortgages to the ECB in a somewhat scary manner. My interest in all of this is that who else is doing this and will it arrive here? Obviously this all gets hidden from public view. So to find out more i went for evidence on the ground that something was amiss in Spain and i was bombarded with stories that construction spending was falling.

Then you said that all was well which seemed to fly in the face of all that i was reading.

I then went and searched 'Spanish Crisis' and the first link i found reported:

--------------------"
Spanish PM's hits its lowest level {popularity) in Spanish crisis
07/21/2008

until two weeks ago, Zapatero dismissed the possibility of an economic crisis and accused the Popular Party of being unpatriotic when they suggested such a risk in the run up to the March 8 vote.

The prime minister finally used the word "crisis" on July 8 as more and more data showed Spain was being pummelled by the collapse of its housing boom, the global credit crunch and soaring fuel prices.

Economy Minister Pedro Solbes last week said Spain faced the most complex crisis in its history after over half a dozen property and construction firms collapsed. "

From that i concluded that the PM had been in a state of denial or did not want to create a panic

-----------------------

But you then once again seem to want to ridicule me for my conclusions and make out i am a fool or liar while simultaneously attempting to flatter me that i am not so daft.

Meanwhile i enjoyed your wonderful descriptions of life in spain and were it not so hot here in Finland might be tempted to travel down and enjoy a few Tacos and mingle and make some friends instead of endlessly worrying about the future of life as we know it!


:-)

I think it is important to understand where somebody is coming from to understand why they are arriving at certain conclusions. You often find on these forums that certain events have led people to post about things. I make assumptions and then people correct me but in the process we find out about that person in a little more detail. So for instance now we find out you have lived in Spain for 5 years which is a fair length of time. You tell us you rent so we can assume that you could have left Spain at any point within that 5 years but have chosen not to. So what confuses me is you then post a link to show how corrupt and unjust Spain is!! You have had 5 years to leave if you didn't like it.



But again you have lived there for over 5 years!!! I dont get what you are saying, you cant be saying it isnt great to live in Spain otherwise you would have left within a year. To live somewhere for over 5 years you must think it is a pretty cool place to live.



Yes, dont buy in Spain if you want to turn a quick profit, fully agree. You have also forgotten to add Spanish Capital Gains Tax on any profit, if you make any. Again the average selling time is dependent on where your house/apartment is situated. A 2 bed apartment overlooking Puerto Banus harbour is going to go within a day, a 3 bed finca in the middle of nowhere is going to take years. This is why advice on picking the right place/area to buy in is essential.



My point is how does this affect your average punter. You obviously have no problem with it because we now know you have been renting in Spain for over 5 years. It hasnt affected me or all the people I know. What relevance does it really have?

If thats the way it came across I can only apologise, it wasn't meant to.

I do agree with everything you say on the Spanish economy, thats what I keep saying. I think the recent honesty of Spanish politicians is refreshing but gives a clear insight into the scale of the problems. Denial may have been the approach before this by politicians but I think your Spaniard on the street was talking of hard times way before any Brit was. Their exposure to a downturn in construction probably made it more apparent earlier on.

My point is this. How does it affect your Auntie Mabel who is retiring out to Spain at 57 with £300k cash? There is no doubt she should rent for a bit, sound things out, take her time. Apart from a few more places for sale your Auntie is going to see little different from 1995,1997,2002,2005 etc and her life if she moves out there is going to be no different. My point was that, not a major point in the grand scheme of things but just that your 20 odd thousand Brits moving out to Spain every year will see little different. They will be exposed if they decide to come back in the short term so my advice would be for all people looking at Spain...take your time and make sure it is the right move.

The Spanish market is medieval in character and anyone who puts the words "Spanish property" and "investment" in the same sentence is not to be taken seriously.

I agree ....
Purchase costs = 12% of purchase price.
Selling costs = 5% agency fees PLUS 16-35% capital gains tax
Capital appreciation = negative.
Apartment/townhouse community fees = anything from 100€ per month to 250€ per month FOREVER!
Rental yields = DOWN
Euro vs Sterling = Too strong

where is the investment?

Until the Spanish government reduce the 7% VAT/Transfer tax (yes 7%!!); reduce capital gains tax; regulate notary, mortgage, lawyer and agency fees, even with an under-supply of property in the Spanish market (which we know will take years to happen given the sheer volume of empty properties on the market), investment potential remains shakey. Coupled with some purchasers of property being stung by government fines for paying too little for a property (I know 2 people this has happened to!) even as short a time ago as 3 years, the Spanish property market has been a sure fire way for purchasers to loose a great amount of money. The Costa del Sol is a sea of to let and for sale signs, but since so many of the buyers have enough money to cushion themselves during this downtime, how long will this property stay empty for? Nobody is quite sure if the bottom has fallen out of the market yet, but few have enough courage to test the water. Many of those who do, have found the banks have shut the door on lending. The 110% mortgages of last year have dried up since so many people took the 10%, handed the keys back to the bank and ran (many back to the UK, Eastern Europe, the carribbean, Dubai, Berlin to name a few!)

Town councils greedy enough to take bribes from unscruplous developers in return for illegal building permission have found themselves in jail, but nothing has been done to rectify the problem of the illegally built property. The buck is passed from government department to department and meanwhile the banks won´t lend, estate agencies won´t sell and nobody can shift their properties.

Real estate agents, banks & mortgage lenders, driven by huge commissions, pushed the market forward at an alarming pace. Now its peaked, Marbella is a ghost town. The pensioners are going outside of the eurozone since their pension money equates to less than it did a year ago, the tourists cannot afford to come here and there are fews jobs left for ex-pats and locals alike. Come to Spain and loose your money! But then again, are other overseas destinations any better in the long run? Maybe I´ve become jaded with international property investment. Is anybody other than the developers making real money out of re-selling their property at a profit? Or are these gains just numbers on a compuer screen?

Some great economic numbers out this week, just for those of you debating the extent of the crisis.

Unemployment up from 9.6% to 10.4% - civil unrest here we come.

Housing permits down 28% Mom, and 58% YoY.

Mortgages down 36%, transactions down 34%.

And in case you forgot, retail sales in June reported down 7.9%.

Here's a news article for our resident genius
http://www.telegraph.co.uk/global/main.jht....xml&page=1
I know you appreciate these links Einstein. You were saying how Spain's woes have no effect on your average Joe. Here's 1500 families for starters that might possibly disagree with you...
One other thing,will you help me with my own amateur psycho analysis and tell me what other names you post under?

Yes this article backs up everything I have been saying. This says it all...



These are exactly the developments (Cons) that I discussed in my posts. These developments are set to drop by 50%+ in my opinion.

I dont mind repeating myself several times over...I have to do much the same to some of my "slower" staff.

Here we go again but quickly this time.
Thousands of Hectacres of land "30mins from beach". This land is arid and often unusable. Developer comes along and buys land for peanuts. Developer ships in African Grass seed and palm trees. Developer brings in graphics company, brochure produced with idylic images. Marketing company bought in to "sell the dream". All of a sudden a concrete shed in the middle of nowhere is worth 200k euros. Developer builds thousands and cant believe his luck, decides to start creating more of these "developments"....plenty of land available 30mins inland. Developers build hundreds of thousands but stupid Brits stop MEW'ing and "investment dream" disappears. Spain left with thousands of empty flats, developers go bankrupt...some stupid Brits left holding the can!!!! Simple as that.

So you get these developments and places like Torrevieja. Places that are basically crap. I have no sympathy for those who fall for these traps.

FYI Forestfire I was originally Adibrown and then Bugga. Nothing else, no need for psycho analysis. Lost password, change of email, nothing more sinister i'm afraid.

This article does not back up everything that you have said. You have made the point several times that the problems in Spain do not affect your average punter. This article says that 1500 families have been affected. Here are your average punters. The fact that the development is neither to your or my liking is irrelevant to the point I was making.
Read the newspapers, search the web, read the expat forums -the picture is not as rosy as you paint it for the average buyer. While the tourists may still be enjoying their time in Spain, the mood among the expats is far less cheery.

I am impressed with the quality of posts on this thread and might consider being a cash buyer in Spain in a couple of years. I have £15k ready. It will all depend on if the average return air fare from the UK comes in at under a £1000.

We were recently involved with a project on Laser eye surgery. I was amazed to find out that 120,000 people a year have laser eye surgery.

If you go on to the internet you'll find forums set up for people having or who have had surgery and it is full of horror stories. We found a number of media articles highlighting complications (in fact 49) all drawing on the personal experiences of people who had been injured during surgery. Positive comments and positive articles on laser surgery were very rare. The forums often contained more negative than positive experiences.

The reality after exhaustive research showed that around 98.9% of people having laser eye surgery had vastly improved eyesight after 6 months. Those 1000 people with complications every year were quite rightly vocal whilst 119,000 success stories were never covered.

Spain is much the same. 1500 useless people buy into dodgy development, happens to be Spain but could be anywhere. Personally I think they deserve it for thinking they were clever getting a golf apartment for half the price of those right by the coast. Well guess what dichead you get what you pay for.

These aren't average punters these are just stupid punters. I think we'll see the back of these sort very soon and normal service will resume.

Shame on you for insulting the name Einstein!!!!

I agree.

Einstein71 does not seem interested in the various realities here.

Success rates with Lasik are over reported by the industry because they quote Snellen acuties which dont reflect a true value of a persons overall vision. Earlier Lasik might be more dangerous than current Lasic perhaps but there is a definate risk there and the last person to properly advise you of the risks will be the well paid 'surgeon' benefiting from your procedure.

Snellen acuity measurement for a given light level does not compare to the ability to actually see clearly or without multiple images that can be found by more comprehensive testing. For example Germany has restrictions on lasik and entry into the police because of the poor night vision. Lasik also creates numerous complications which people tend to 'live with' such as dryer eyes than normal and where it is recorded as a success and since the procedure involves slicing the cornea almost fully off there are also various possible complications if a person gets into some very physical activities.

As for Spain i note that Morgan Stanley have warned that Spanish banks are now so exposed by the economic situation that they have issued warnings on the banks.

To suggest Spanish problems are limited to a few dickheads is obviously dishonest given the nature of the crisis.

OK, so the combination of buying a property in spain with an eye correction surgery is bordering on stupidity. But, by the grace of God, I don't have eye problems and I am actually interested in Spain as a holiday home from the UK.

Reasons:

- warm seas (med, not atlantic)
- close to UK
- cheap flights
making long weekend breaks possible.


I was thinking of Murcia and hoping to find a suitable villa with pool.

Do I need a reality check? Should I steer clear? Should I consider something else?

I was also considering Saidia, but the landscape is too barren for me. I might still investigate further.

The atlantic side is a no-go ... cold seas.

Ta.

Hi Fella/feller,

I think spain is a nice country to live and as you seem to know ticks all the right boxes, cheap to fly too, assessable by car, warm seas and good weather for most of the year. Coupled with civilised people [apart from the Estate agents and related professions] it makes a good place to retire too, if you dont have a job to come to then for most people forget it.

Anyway my main point is that you should try to get to know an area first before buying and I think for most people it is better to buy in an established area and on not isolated, we have a lot thiefs here for sure the illegal immigrants unlike UK dont get state handouts so they steal instead, so its better to have the security of others around you especially if you are using your house as a holiday home. I dont think this theft is a new problem cos is seems like a lot of the older houses and flats in towns all have grills fitted form new.

There are lots of houses for sale so there is no problem in undercutting the asking prices. Be aware that traditionally the estate agents would get 10% of the asking price so there is a large margin here that can be bartered for. Also make sure the house is legal and has no debts attached.
Good luck and don't be in a rush, prices may reduce some more in the near future.
Tony

Rent somewhere first! If you can´t spare the time to live at your chosen location for at least 6 months to see what it´s like, then you shoudn´t really be investing a large portion of your life savings in buying somewhere. Really, it would be wise to wait until 2010 to see if the world economy recovers first.

I didn't know Spain had problems with theft /burglary. I think I've developed an fairy-tale view of things.

Is it a big problem?

Thanks for the advice on staying out there first - on reflection, I think it is wise advice especially if I want it to feel like a home from home.

I've been to Menorca/Majorca but not mainland Spain. I would really consider Menorca, but prices seem too high. I didn't notice any security problems there.

I'll try getting a break to Granada/Murcia sometime to get a feel for the area.

Thanks.

Sorry to say, you seem to be an easy prey for the official and un-official thieves that abound in Spain. I would advise you to do a thorough research on the stories of thousands and thousands of people who got badly burned in Spain.

On the other hand, Murcia is OK area. I rented 3 weeks ago a 2 bedroom apt. in a nice resort veryclose to the sea for £150/week. The resort was empty so we could enjoy the swimming pool all by ourselves.

Thanks Catara, I think you are quite right.

I've been looking into the idea of owning an overseas property for over a year now.

I nearly bought in Morocco after being convinced by dogbox, but found it way too expensive (hibiscus villas were about 250k then, when a year earlier they were 186k).

I found something comparable in Turkey (80K) that was very nice, ticked all the boxes except it is a little bit too far for a long weekend break (1hr_checkin+4hr_flight+1.5hr_transfer = around around 6.5 hours).

I think I need to stop convincing myself that I *need* a holiday home - instead I'll holiday around and decide on something when it feels more comfortable.

At least, with this credit crunch, time is not of the essence anymore!

Digs,

With all this turmoil going off at the moment why not be contect with just renting. There are so many holiday homes all over the world and because of this surplus, rents are cheap. Put your money in a high deposit account and sleep at night. Of course if your'e rolling in money no problems, just research well.

Regardles to the theft situation, in my residencia of 64 house which was finished 3 years ago there were 13 houses broken into within the first 6 months. Most of the thiefs are either the builders or friends of the builders who are tipped off by the builders and they know which houses dont have alarms or grills fitted. It seems like the companies that sell you the houses know that this theft on new houses goes on and i think they should be made rsponsible for the thefts and put on extra security when people are first moving into their houses. But they don't because they dont give a stuff about your welfare once they have your money. Also there are many impromtu thefts around the towns and cities, particularly the ladies and elderly.

Having denigrated the building trades and the theft problem , as long as your are aware of these problems it is a good place to live, far better than where I lived in uk with gangs of hoodies other other miscreants.

Tony

I stuck up another thread on what has happened to a friend of mine on his development. RENTING must really be the only answer as at least you can simply move out when the "Administrator" and their pet builders start carrying out "repairs & maintenance". What experience of your residents asso/junta do u have?

Just reading this thread. Let me say immediately I live in France not Spain but I'll make a hopefully helpful observations - and NO I am not Einstein71 !

Seems to me much of this debate is rather pointless because in essence the various parties are just stating their opinions based upon their particular circumstances and perceptions. People rarely have the same perception of anything and use (legitimately) stats to try and 'prove' their perception is right.

If one reads what Einstein71 is saying, he's not saying anywhere that Spain doesn't have big troubles or issues. To me, as an unbiased reader, what he seems to be saying is just that these troubles have to be seen in context - and this surely cannot be wrong ?

To give perhaps a less controversial example - I know people in the UK (very large numbers) who when the subject of say the early 90s crash and recession comes up, will say in all innocence "what recession/crash ?" That's because for various reasons they were not particularly affected. This also is true for millions of others.

I know millions who wehn asked

I keep hitting the wrong key and posting too quickly !

To continue

I know millions who if asked about the social upheavel and catastrophe of the 1980s miners strike etc under Thatcher who would say "didn't affect me at all" Of course if you ask people in the mining towns or surround areas you'll get a different picture of course.

I could go on.............

I think Einstein71's view essentially is that for very large numbers of the Spanish population, foreign or otherwise, the current troubles and forecast troubles are unlikely to change their day to day lives much. From my own experiences in France I suspect he has a point. French people for example, have never really seen property as speculative quick-return investment. It is the foreigners who get burned - at least those who did not do their homework on location etc.

His point about the Spanish property bubble is also I think well made. I know some of these vast developments around certain of the costas and a good indication was that for many years local Spanish buyers would not touch many of them with a barge pole. Many of them always described these developments as white elephants for the future and openly laughed at the prices foreign incomers were paying saying "they'll be sorry! ".

The same thing has happened in France. Many UK buyers paid far too much for properties that were in the middle of nowhere and if there was ever even the slightest property price correction/downturn then the property would be unsaleable - because local French buyers would simply not touch that type of property in those locations at any price. Even in the Spanish 'boom years' I know large numbers of sensible people who were desperately trying to raise warning flags to foreign investers but who were drowned out in the clamour of greed for a quick return.

The point is, that these downturns always affect some more than others and also, whilst it may offend our sense of justice, the reality is that very large njumbers of people are simply not affected by them - and not just the super-rich either.

Will this downturn be different ? Not sure but I doubt it. In some parts of Spain propert prices are stable if in desirable areas. People owning and perhaps buying in those areas are unlikely I think to suffer massive trauma over time.

PS - I am not an EA and have no connection whatsoever to property sales, rentals etc.

"Seems to me much of this debate is rather pointless because in essence the various parties are just stating their opinions based upon their particular circumstances and perceptions. People rarely have the same perception of anything and use (legitimately) stats to try and 'prove' their perception is right."

If the debate is pointless then why take part?
Every single post on this thread has a bias -yours is no different.
The fundamental disagreement raised by Einstein71 is that the average man is not affected by Spain's problems.
His and your biased perception is that the average man is not affected. Neither of you live in Spain.
My biased opinion, and that of a few other forum members who actually live in Spain is that you are wrong.

I think the word I used 'debate' was perhaps imprecise. Perhaps 'vitriol' would have been better. My apologies if so.

My intention was to try and broaden the perspectives away from confrontation and the attacking of individuals at a quite personal level simply because they expressed a view.

Words like 'bias' can be provocative, usually used as influencers and indeed they are best avoided - to state someone's views are biased usually is to imply a degree of irrationality or that they are perhaps unable or unqualified to think objectively though I note you've described your own views likewise which is even-handed.

I hope I am as unbiased as I can be (I have tried but I cannot see how I have any bias in this at all as I am not affected but I could be wrong) but of course you may be right at a philosophical or psychological level - we could have a big and largely irrelevent debate about whether any view expressed anywhere is unbiased or not but what does that give us ?

I think with respect you are also mistaken in your implication that somehow people living in Spain are the only ones who can have a 'true' perspective. On that basis nobody anywhere would ever be able to have or express a legitimate or qualified view on anywhere unless they happened to live in the place concerned. That view if taken further, gets more and more into chaotic waters. Are your views on property prices and effects in a town say 50kilometres from you, absolutely valueless because you do not live there full time? If that's nonsense, at what point would you stop say your views don't have any value ? Would people buying in say a development outside Madrid say your views are irrelevent because you don't live there ? Vigo ?

No, it can't be such. I always welcome views as informed and rational if they are well expressed and based on some facts/analogies whether they originate from Spain, France, China or the moon, and providing they avoid sideswipes, sarcasm and point-scoring at a personal level.

I think my point is, and I suspect that of Einstein, is that these things are relative and one's life experiences are worth sharing. It is up to readers whether ot not they agree with the position taken. To dismiss the views with contempt and agression simply because the person concerned doesn't live full time in a given domain is I think flawed.

In terms of Spain, during this difficult period I hope we can all agree its experiences will be broadly similar to other places in the world which experienced large scale development targetted pretty much at foreign investment / immigration. This happened in parts of France and Italy also, Portugal Greece and places like Croatia have all slipepd into making the same mistake. In troubled times, these developments targetted fairly specifically at foreigners with disposal investment cash, are always the ones to take the biggest and disproportionate hits. There is nothing uniquely 'Spanish' about this phenomenon.

Times are very hard in Spain I know - and they are just as bad here in France. Yes, these 'bad times' affect many but if one looks at the European stats, some things in my opinion and experience are clear

a) foreign investers who have invested in large 'vacation/retirement themed' apartments and villas outside of traditional centres almost always take the biggest and most painful hits - way way way over and above the owner population averages
The next most significant pain is felt by those who have purchased farm type properties (fincas in Spain or fermes in France - no real difference) miles away from anywhere and done them up. This group are sometimes called 'neo-colonists' ! These properties can frequently be totally unsaleable to local people and only incomers buy them - which is why if incomer purchasers disappear because of troubles 'back home' then the property can overnight find it has in effect zero value.
c) The local population sub-prime purchasers - those who have stretched themselves on low or moderate incomes to buy marginal properties on big urbanised developments or, in the UK, some outer city flats and ex-council houses etc. These properties are only saleable if demand across the board is very high.
d) The traditional local 'medium or upper income' buyers of traditionally desirable homes in traditionally desirable locations purchased mainly by locals and used as family hiomes for commuting/life etc.

I am sure that anyone in any of the above first three groups will feel a lot of trauma and see the world as slipping into disaster - they are right to do so. Nothing I or anyone else says is going to change their views or make them feel better about the world and they do have my sympathy. Those in the fourth group will also take some pain, but in times of recession the stats are very very clear globally - the people in the fourth group ALWAYS suffer LEAST in terms of hits of price reductions.

However, even in Spain people in these categories are not 'the majority'. If one has a house and has no intention of moving/trying to sell, and no intention of trying to raise capital against a house sale or loan, then declines in the value of your house are only conceptual. You may worry a little at night about what your family will inherit one day but actually it has no effect at all on your day-to-day life. There are millions upon millions of people in this category.

I doubt someone of modest living standards in a city centre rented flat in say Bilbao, loses much sleep at night worrying about the problems of British owners in brand new developments on the med coast. They'll be getting on with their lives as normal and only worrying about the security of their job. There are tens of millions in this category - their lives are unaffected by primary house price reductions - though there may be some secondary knock-on effects via construction job losses of course. Point made well by others earlier.

I also know in all countries that some good properties in very desirable areas are holding up well - reductions are minimal and not a serious concern to the owners lucky enough to have had the money to buy quality in the right location in the first place. They are not too worried either.

Above all, the queestion is - are we talking about house prices per se, or the entire economy? The two are linked but are not the same thing. Many may feel the effects of the economic downturn, but not necessarily directly any affects of house price reductions.

I think in all, these were the sorts of points Einstein was making and it is hard to see where his logic is falty. I could disagree with him if someone made a good counter-argument, but I can't rubbish his views just because he doesn't live full time in Spain.

In closing, I'll have a friendly bet that once things pick-up there will be millions who have their horror experiences of this current grim situation, but probably far more millions for whom this 'recession' will just have passed-by with little if any affect. I could be wrong of course though !

In passing, I am NOT one of the fortunate. I am trying to sell in France and can't. This is causing us serious inconvenience though luckily not financial grief.

I think most posters enjoy having a go at Einstein71 and his other aliases because of some of the dopey and
incorrect statements he´s made, but of course everyone has the right to an alternative view which is what the forum is about!

Anyway, are you prepared to share any details about what you are trying to sell, where and if it´s mortgaged etc? I´ve been trying to sell a flat (owned outright) here for over two years without any success and have been forced into renting it out which is a right pain in the a***, and like you it is causing me serious inconvenience as I have better things to do with my time.

Yep, no secret at all ! I have a largish 19th century character French property in a village centre in north west France. About 3,000m2 of land and about 255m2 living space. Need to move for business reasons somewhere further south as we're in the wriong place for my business - we are not returning to the UK . 2nd separate small house.

It's been on the market for 7 months with little interest. It is not a price issue - there are simply no buyers at any price in large parts of France. To be clear (and I'd be staggered if the same wasn't true in Spain) there are two markets in France. There are those properties purchased mainly by foreigners - usually brand new apartments nearish holiday resorts or more commonly here, big old character rural properties conveniently placed for absolutely nowhere.

For these types of properties in France a massive percentage of potential buyers have been British or foreign over the past 15-20 years and they have kept the market for these properties going for many years. Now the Brits are staying at home due to fear (and lack of funds) the market for these types of property has taken a big hit.

Most local buyers (ie French) these days want modern properties usually close to major centres of work. They will buy older properties sometimes but location and condition are key. In essence the two markets are largely separate - and I have seen similar things in Spain.

We thought we'd been smart(ish) by buying and old character town house in a village centre but it hasn't made any difference - there are no buyers of any description at the moment other than for smaller modern properties of the sort I mentioned above and some prestige properties in commuter belts of major cities.

Just to repeat the message though - some proerties in some parts of France are not only holding up well but actually showing some price increases. Paris central areas obviously but also the modern houses on the outskirts of big centres are doing OK as in general are a lot of traditional quality individual coastal properties with character and location - they're taking longer to sell and suffering some price reductions but nothing compared to the big new holiday developments of apartments and such along the med or the restored barn type properties 30k from anywhere else.

It is very very painful for some foreign residents here. I've said on the French house price thread that theres a big story to cover here about Brits in France (and I suspect Spain also) who have properties that are unsaleable and of virtually zero value. Many are slipping further and further into financial troubles as a result of being 'stuck' and having capital tied up they simply can't access and maybe won't be able to for several years let - in some cases the losses could be very large indeed . Vast sums of money are potentially going to be lost. I am surprised this story hasn't been picked up yet by the media - or if it has I haven't seen it !

Sad times for sure.

Thanks for the insight. I was thinking of buying something in the Med for the winter ( Jan to April) because winters are too cold in Prague but after reading numerous posts in the offshore section I can see it would be far better to rent even if you pay a premium for it.

The only part I do not like is not being able to have our own furnishings around but I think I could put up with that for less hassle in the long run of maintenance etc for 3 months a year.

As for your predicament Happysort were you the victim of a UK property program? I always watch these with the wife and drool at what you can get for your money but then she says "what you going to do in the middle of nowhere". I think she is right unless you are used to being isolated. I need to be near a large urban area, usually the capital city for when the boredom gets too much you can just hop in the car and be in town for something different. I have looked in the Czech countryside numerous times and amazing old stately homes for peanuts but after a day in the sticks I am always glad to get back to the city.

Anyway I wish you luck with the sale although I expect you will probably take a hit in the current climate.

Hi MaxD.

Fortunately we're we're not likely to take a severe hit because we purchased in late 2002 so did not really buy at peak prices which was around 2006. The biggest problem we have is now being 'stuck' logistically and unable to move to where we need to for my business.

We came here to give our children a second language and culture and if I am truthful, to escape some of the major problems of life in the UK today. I could speak for hours about the advantages of living in France as opposed to the UK though France is not paradise - it has its own problems as I guess does Spain and eveywhere else.

I think many who moved to Spain and France (the two biggest destinations for UK folk) were influenced by the "buy a Spanish castle for 1.50 pounds and live like kings" type programmes showing sand, rivers, mountains, kirs, vineyards, sangria, beautiful houses etc. Its not fashionable to admit it but I think deep down many people were !

I want to be clear though - I and hundreds of thousands of others who moved permanently to Spain or France have few if any regrets. There are quite a few who do and I respect their views but my hunch is that they are a minority. In France the stats are that about 25%-30% of British incomers sell and return to the UK after 2 years or so. I think I have read similar stats for Spain where I think the figures are slightly higher.

The interesting thing is looking at what little research has been done regarding these people in France and Spain who want 'out'.

The stats seem to show three main groups

a) There are those who saw their property as an investment and business opportunity - free holidays and holiday rental or letting income plus appreciating capital etc. This is rather more common in Spain than France but did happen here also.
Those who moved permanently but found it impossible to obtain income (usually due to language problems or no work to be found) and could not survive so had to run for home - this is a huge problem for Brits in France. Not sure about Spain.
c) Those who having arrived, just could not settle and integrate (eg missing family back home) and hated the place - for whatever reason.

Most of the research I've seen shows some differences between France and Spain in this respect. The Brits who want out in Spain have a high number in category 'c' and 'a' whereas in France most brits selling and leaving quickly come into category 'b'. It's an interesting fact that many Brits leaving France for the UK actually express many regrets at having to go. I'm not sure about the same groups in Spain. Anyone want to comment ?

I suspect the category 'a' people in Spain, and the fewer of those in France, are those having the biggest financial and perhaps emotional problems and I really sympathise. The trouble is that for around 40 years now in the UK we've had a very highly mobile population. People are always selling and moving every few years for family or job reasons etc. We all became used to being able to sell quickly and 'move on' when we wanted or needed to - often making a few bob in profits in the process.

Trouble is, we took that mindset with us to Spain and France. People are too quick to attribute 'greed' to UK people overseas which is unfair - it is far more the case that many of us just did not understand that in Europe virtually no other country has a society like that. Particularly in the south, Italy Spain and France have NEVER had markets like that historically, people just do not move house every 3-5 years because they move jobs or have itchy feet or just fancy a change, or want to make a profit on their house.

Therefore the 'pool' for sales, turnover and quick 'out' opportunities was always very very limited to new foreigners arriving with money in their pockets. Particularly in many new developments in Spain, the slightest unease in the home-base of this pool of buyers (UK Germany and Holland for the most part) was always going to hit the market staggingly hard because there was no 'local' market demand as such to take up any slack.

This has come as a rude shock.

What for the future? I just guess a couple of things about Spain based on hunches.

1. Spain has certain attractions that cannot be eroded by the international markets. Sun, sea, sand and countryside. Worth noting that this year record numbers of Brits stayed at home for their hols due to worries about the economy - and predictably many got washed out in the usual dismal northern european summer weather. I wonder if they'll make the same decision next year ?
2. Worth noting that quite a few smart economists are pointing out that the international economic situation is NOT that bad. Many say the situation is being badly over-hyped by the media searching for stories and thereby talking down sentiments. Check out the dollar's recent recovery as US analysts have started to grasp that their economy is actually not in as bad a shape as they thought.
3. There are places where disposable money is increasing rapdily - notably eastern Europe such as Russia, Poland, and the Baltic states. All cold places with at best unpredictable summers.
4. The big falls in many Spanish prices are starting to make some Spanish property look sensible again (much was hopelessly overpriced for a long time)

Add these things together and I'd guess that Spain is going to start to look atractive again in the not too distant future. However, any recovery is going to hit the nicer traditional slightly more prestigious properties (eg villas etc) in the better locations close to beaches and facilities. If I had money, which I don't, I might be tempted even in late 2008 or early 2009 to start trying to driver a hard bargain on some properties of that type.

I admist I think i