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Realistbear

Spanish Properties Remained 46.7 Percent Overpriced

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http://uk.finance.yahoo.com/news/property-bubble-fears-weigh-on-spanish-recovery-afp-ba076e92acb9.html?x=0

Property bubble fears weigh on Spanish recovery
Katell Abiven, 5:42, Sunday 14 November 2010
Knock-down home prices, idle cranes and builders forced to retrain for new jobs: despite sliding prices the spectre of a Spanish property bubble is hurting a fragile economic recovery.
The new labour minister, Valeriano Gomez, summed it up when he took over at the end of October: "Three out of four jobs lost in the crisis are in construction and related sectors."
Spain has the euro zone's highest jobless rate at about 20 percent.

They, like us, have only seen a tiny drop (25%) from the frothy top.

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I don't think anyone really knows the real state of the Spanish housing market. The banks are involved in buying the properties and shifting them to zombie companies. They have 1 million unsold new build properties, unemployment is 20.8% according to the latest eurostat figures, has been rising by 0.2% a month. In the latest figures the main source (90,000 jobs) was the public sector. The economy did not grow in the last quarter (even from official figures). There has been virtually no increase in mortgage lending for 18-24 months.

It would be nice to have some sales figures that only include private transactions rather than the banks shifting property around. I would speculate prices are really 40-50% off the top already.

Can you imagine what property prices here would be like with 20.8% unemployment?

(http://spaineconomy.blogspot.com/2010/10/mr-zapatero-said-what.html)

Statistics coming out of Spain seem more like a massive propaganda exercise to hide the scale of the problems. I would not trust any official data at all TBH.

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I don't think anyone really knows the real state of the Spanish housing market. The banks are involved in buying the properties and shifting them to zombie companies. They have 1 million unsold new build properties, unemployment is 20.8% according to the latest eurostat figures, has been rising by 0.2% a month. In the latest figures the main source (90,000 jobs) was the public sector. The economy did not grow in the last quarter (even from official figures). There has been virtually no increase in mortgage lending for 18-24 months.

It would be nice to have some sales figures that only include private transactions rather than the banks shifting property around. I would speculate prices are really 40-50% off the top already.

Can you imagine what property prices here would be like with 20.8% unemployment?

(http://spaineconomy.blogspot.com/2010/10/mr-zapatero-said-what.html)

Statistics coming out of Spain seem more like a massive propaganda exercise to hide the scale of the problems. I would not trust any official data at all TBH.

Funnily enough, if you look at the numbers of "economically inactive" in the UK, you can see 8 million people of working age without a job (more than a fifth of the working population)

Telegrapgh report

Spain "suffers" in the same way London does - its property prices are inflated by foreign buyers. Bad news for local people trying to get on the ladder, who knows when (or if) the real correction will come? It's rumoured that the Chinese are being courted to invest in Spain too, so who knows if the present prices can hold up. No doubt at all that prices don't reflect long term local wage to price level, but if people from outside still pay the high prices it's hard to call them overpriced. Irrational may be a better word?

There is actually some optimism regarding the general Spanish economy. Exports are allegedly doing well, particularly furniture,defence&weapons (didn't the UK army purchase some tanks earlier this year?), railway technology, automotive components, aerospace technology and components, machinery&equipment, renewable energy tech&components, construction materials, wine, and for that reason we shouldn't necessarily disbelieve the IMF's forecast that by 2013 Spain's growth will surpass that of Germanys. But yes, there is a lot of pain as very few new jobs have been created, especially for young Spanish looking for a worthwhile job. Which may be why I hear a lot of Spanish voices on the streets of London?

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. Which may be why I hear a lot of Spanish voices on the streets of London?

Loads of South Americans in London these days too though.

Maybe, but the accent is totally different.

Interesting report here about the Irish having to flee abroad (again) for work. No wonder Ryanair is still making money!

Ireland economic crisis

Buffini will soon learn if her fees at the Institute of Technology in Tallaght, south Dublin, have climbed beyond her means. Her father is a self-employed builder, which has recently become a euphemism for "unemployed".

"My class size will have dropped by 50% by next year," Buffini said. "Even lecturers took part in the recent student protests over fees because society here is going to be left with very few educated people. My best friends have already left – they're doing bar work in Spain and Australia.

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Even if prices fall by 30 - 40%, you still won't be able to purchase at a lower price. Debts stay with the property, you cannot just walk away and the property be sold. The next buyer will pick up the outstanding debts. . And, on top of that, if you pay less, the Government will assess the property for purchase tax based on their valuation, not the lower price. You will get stung for higher tax.

Buyers are stuck between a rock and a hard place. Cannot pay the mortgage and cannot sell. The repossed properties will eventually be released by the banks, but the debt stays. And the banks don't see it their job the pay the monthly community charges on the repossesions, so the debts on the place are just going up and up.

AND don't forget the corruption with illegal builds etc. You stand a high chance of owning a property which may get demolished, or at least you will have to pay a small fortune to get it legalised.

Spain is a basket case. If they think building more shitty cheap houses will get them out of the crap, they are wrong.

Don't ever think of buying there - just rent.

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  • 149 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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