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Spanish Property - How Much Would You Pay To Own One


soldintime
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Can't you just find someone, either with a small business or domestic property, and rent storage space from them?

There must be loads of people who'd love some passive extra income, and who'd bite your hands off.

Yes that's a good idea. It doesn't sound as long term as owning a storage area would be though. And I don't know if I can trust a setup like this anymore than what I currently do, which is leaving things with friends.

I've also tried buying and selling things everytime I visit but it's a real PITA. Last time I ended up just giving away a £100 surfboard because I couldn't get rid of it in time.

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Just bought a 6 bedroom villa in canaries for 260k euro. Look for properties under 1000 euro per m2 and you are getting at below cost if it is a good standard. IN peak times it would have been over 600K.

On the one hand the higher end of the market is a better bet I suppose.

Main problem in Spain is that the authorities don't think twice about taking your property off you... ie all the land grab / getting the victims to pay for the destruction and removal of their own properties.

In a SHTF situation (eg. leave EUR/devaluation/civil breakdown), the spanish would just declare that all property rights belonging to non-spanish citizens are null and void / are now the property of the spanish state / you will be forced to sell to the state at cents to the new peseta. Once outside the EU law, they can and will do whatever they want to protect their own citizens. As to be expected.

Well said. They are taxing solar panels and recently banned rents shorter than 3 months under pressure from hotels.

So "that you rent out maximum 5-8 weeks a year" doesn't work any more.

With studies showing how NY has boosted it's own economy through increased competition in the hotels sector (http://www.businessinsider.com/airbnb-632-million-economic-activity-new-york-2013-10) this is a good example of how when things go bad a self fulfilling cycle generates, increasing economic problems. Take note because this is something the kind of thing we are going to see next year in the UK - restricting trade and competition in some form or another, designed to help people when in fact it just damages the economy further and makes people worse off.

So far the properties at reduced cost and from banks have all been holiday homes. This is pie in the sky living from an earlier age complete with €100/month swimming pool community fees. If you find property that is at the right price (within the very long term 50x monthly rent price), which a real spanish family can call their home, please let me know.

In my opinion prices outside of repossessed holiday homes are still high.

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Just bought a 6 bedroom villa in canaries for 260k euro. Look for properties under 1000 euro per m2 and you are getting at below cost if it is a good standard. IN peak times it would have been over 600K.

Good luck with it.

I read something about a new tax last week. Keep a bit of cash handy just in case?

Local tax offices in Spain are issuing demands for overseas buyers to pay extra taxes on the grounds their purchases prices are too low.

According to discussions on Spanish property forums, demands are being issued for an extra asset transfer tax or penalty often a year or more after completion.

The taxes are aimed at clamping down on illegal under-the-table cash payments known as B-money.

Purchases below “market value” have traditionally been subject to the additional taxes and penalties. However, the formula used to calculate when the tax should be imposed is based on outdated assumptions about “market value”. It seemed to work in a rising market but now prices have dropped, international buyers picking up bargains are being hit with an additional bill.

Frustratingly the appeals procedure is slow and can take over a year to conclude. Even if buyers win, the legal costs are not recoverable making it uneconomic for most purchasers to contest the tax.

http://www.globaledge.co.uk/news/spain-hits-overseas-buyers-with-bargain-60082

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Good luck with it.

I read something about a new tax last week. Keep a bit of cash handy just in case?

Yeah, know about this one. Transfer tax is up to 10% so many pay cash unsurprisingly to get around it, so now the government assess the property on their tables. No doubt for what I bought for I will get scrutinized.

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Yeah, know about this one. Transfer tax is up to 10% so many pay cash unsurprisingly to get around it, so now the government assess the property on their tables. No doubt for what I bought for I will get scrutinized.

I've read that if you do get scrutinised it might help if you have documentation backing up that it was in a poor state. This might be comments from an agent etc about anything in poor condition or needing work. If there are any bits that need work, might be an idea to take photos before you do it.

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  • 2 weeks later...
  • 3 months later...

Banks, funds line up for landmark Spanish property sale: sources

Tue Mar 4, 2014 2:37pm EST

(Reuters) - Banks such as Deutsche Bank (DBKGn.DE) and JPMorgan (JPM.N) are teaming up with international funds to bid for a multi-billion-euro portfolio of Spanish property loans as the country's real estate market thaws, sources close to the process said.

The loan package of over 4 billion euros ($5.5 billion), from Germany's Commerzbank (CBKG.DE), is one of the biggest of its kind to be auctioned in Spain's six-year real estate slump as lenders burned in the crisis clean up their books.

It is made up of some soured debts and other performing loans backed by office blocks and shopping centers, rather than debts related to residential homes which have more commonly been offered to investors.

That is helping the portfolio attract buyers, the sources familiar with the process said, though funds have also been flocking to Spain recently as the country emerges from recession and property prices come closer to hitting bottom after falling around 40 percent since 2007.

...

"The Commerzbank deal is so big that other banks keen to sell portfolios have been holding off, waiting for this to get done, as the bidders can't really focus on anything else right now," the lawyer familiar with the process said.

The prices paid for such assets vary enormously. Investors sometimes bid as little as five to 10 percent of the face value of distressed property loans, while better assets might be sold for 80 or 90 percent of face value.

Spanish lenders and foreign banks operating in the country had been slow to shed property portfolios until recently because the bid and ask price gap was very wide.

But the improving economy is encouraging investors to raise offers while banks have also taken hefty writedowns on the value of their loans and properties.

... in full at http://www.reuters.c...EA231ZH20140304

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  • 1 month later...

I had a look at some properties advertised at eye on spain. Some reasonably priced like this 3 bed detached house with private pool.

http://www.eyeonspain.com/property/private/sp1878

And then i saw this in the description:

I must tell you the urbanitation is on distress at the moment, it does not have facilites , like sort of shops, restaurants...... ect, as well the golf course has been closed, but the peace and tranquility you breath in here, makes it really special, and we are closed to hand to everything!. I just moved in here!!!

There must be hundreds of thousands of these locations where it is desolate.

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I have been doing some more detailed research into possible areas of opportunities in Spanish real estate. My initial focus was areas which have had a severe price drop, but still close to big cities or beaches. I have been looking at an area 35 mins from centre of Barcelona and 10 mins from beach, where 4-5 bedroom detached 200 sqm+ houses go now for €190-280K, with land area of 600-1000 sqm. My initial house house i looked at was a 6 bedroom house with 1000sqm land, built in 2007. The house was empty for the last 3 years. The place was stripped bare, no electricity sockets, heating system stripped, window frames stripped, doors, toilets, sinks, kitchen all striped. Grass 1 meter high, place completely over grown. I can see banks that have repossessed have no incentive to keep place up as the owner will still be responsible for the debt until they die, unlike the USA. Initially I was attracted to the opportunity, however I was shocked about the state of the house 3 years after it was abandoned. Also the urbanization was not that well maintained anymore, with public paths overgrown. This is not your typical Brit / expat urbanization, but more a 25% full time and 45% spanish, 30% foreign owned urbanization. This place was initially over 550K in boom times, now advertised for 220K. I reckon it can go lower. I may make a cheeky offer....

as MAXD said - cost of new build in Catalonia is about €1000sqm, cost of land is anywhere from 50-120 per sqm (discounted), so look for deals that are 30-50% below.

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I have been doing some more detailed research into possible areas of opportunities in Spanish real estate. My initial focus was areas which have had a severe price drop, but still close to big cities or beaches. I have been looking at an area 35 mins from centre of Barcelona and 10 mins from beach, where 4-5 bedroom detached 200 sqm+ houses go now for €190-280K, with land area of 600-1000 sqm. My initial house house i looked at was a 6 bedroom house with 1000sqm land, built in 2007. The house was empty for the last 3 years. The place was stripped bare, no electricity sockets, heating system stripped, window frames stripped, doors, toilets, sinks, kitchen all striped. Grass 1 meter high, place completely over grown. I can see banks that have repossessed have no incentive to keep place up as the owner will still be responsible for the debt until they die, unlike the USA. Initially I was attracted to the opportunity, however I was shocked about the state of the house 3 years after it was abandoned. Also the urbanization was not that well maintained anymore, with public paths overgrown. This is not your typical Brit / expat urbanization, but more a 25% full time and 45% spanish, 30% foreign owned urbanization. This place was initially over 550K in boom times, now advertised for 220K. I reckon it can go lower. I may make a cheeky offer....

as MAXD said - cost of new build in Catalonia is about €1000sqm, cost of land is anywhere from 50-120 per sqm (discounted), so look for deals that are 30-50% below.

What you've described is a shell, and it might even have structural damage if it's been treated like that, 220k isn't that cheap for something in that condition, it will cost a lot to do the entire interior of a 6 bed house.

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What you've described is a shell, and it might even have structural damage if it's been treated like that, 220k isn't that cheap for something in that condition, it will cost a lot to do the entire interior of a 6 bed house.

It is not a complete shell. It had been lived in for a couple of years, it just has been striped by thieves/vandals. It is tiled the walls and ceiling like good. The wiring is there, the piping is there and bath and showers are there. All the shutters are there however half of the window frames have been taken out. Plus half the kitchen is there. I reckon it would take €30K to do up nicely. I would be tempted if I get it finished and done up for about €200K another €10K should do the pool.

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Just got back from a 4 month stint over the winter. I got a container from China all via Alibaba.com with renovation materials and furniture. Got massive a ton of bi-fold doors put in, Canary Island price was 28k, china price was 8K eur. Got 3 nice leather sofas. rattan garden stuff, tiles ( nasty shock eu have 80% anti dumping tax on these) air con, solar panels, beds, mattresses. shower screens, iron door, railings etc. All in was 26K + transport. If you need some help soldintime let me know if you want to go down the renovation route. I now have a beautiful villa that will serve my family for the next 20 years.

I will be able to let this place out for 1400 a week short term, this is my day job and I understand short term rentals. Another way I intend to leverage the villa is by doing house swaps on homexchange etc in all parts of the world.

Honestly I think the time is now to buy on the coast, forget inland spain, some places will take 20 years to sell in the cynical developments that were not thought through. After 7 years of price falls it feels like it is near the bottom. Some idiots still think their houses are worth 2007 prices, they will never sell at those prices and they need to accept the reality.

Within a 500 meter radius of our villa others are being renovated by people who have just bought. Buy low and sell high, not the other way around. Nice places in the right areas for the right price are selling and there is definitely an uptick in construction. The Canary Islands are quite smart, there is a ban on new builds therefore your only option is to buy ready or renovate so I guess the overflow is being depleted slowly.

People are always going to leave Northern Europe to retire in the sun, again I stress the point look for something under 1000 euro/m2 including the land. Maybe a bit more if it is done completely and to your taste.

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Just got back from a 4 month stint over the winter. I got a container from China all via Alibaba.com with renovation materials and furniture. Got massive a ton of bi-fold doors put in, Canary Island price was 28k, china price was 8K eur. Got 3 nice leather sofas. rattan garden stuff, tiles ( nasty shock eu have 80% anti dumping tax on these) air con, solar panels, beds, mattresses. shower screens, iron door, railings etc. All in was 26K + transport. If you need some help soldintime let me know if you want to go down the renovation route. I now have a beautiful villa that will serve my family for the next 20 years.

I will be able to let this place out for 1400 a week short term, this is my day job and I understand short term rentals. Another way I intend to leverage the villa is by doing house swaps on homexchange etc in all parts of the world.

Honestly I think the time is now to buy on the coast, forget inland spain, some places will take 20 years to sell in the cynical developments that were not thought through. After 7 years of price falls it feels like it is near the bottom. Some idiots still think their houses are worth 2007 prices, they will never sell at those prices and they need to accept the reality.

Within a 500 meter radius of our villa others are being renovated by people who have just bought. Buy low and sell high, not the other way around. Nice places in the right areas for the right price are selling and there is definitely an uptick in construction. The Canary Islands are quite smart, there is a ban on new builds therefore your only option is to buy ready or renovate so I guess the overflow is being depleted slowly.

People are always going to leave Northern Europe to retire in the sun, again I stress the point look for something under 1000 euro/m2 including the land. Maybe a bit more if it is done completely and to your taste.

MaxD

Well done for sourcing out of China for most of your stuff. I will certainly look in to this. I am still exploring options at the moment. No need to rush into this market yet.

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  • 3 weeks later...

Pic I took of an article from Sunday Tel. (25 May 14) - attached.

I personally don't think much of the exterior photo of their dream house, if it's remote by itself.

My view is there is still opportunity to come for better value in prime stock - (holiday/retirement).

spain1_may2014.jpg

spain2_may2014.jpg

spain_other_may2014.jpg

post-12306-0-10441500-1401194485_thumb.jpg

post-12306-0-32554600-1401194507_thumb.jpg

post-12306-0-02701700-1401194532_thumb.jpg

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Pic I took of an article from Sunday Tel. (25 May 14) - attached.

I personally don't think much of the exterior photo of their dream house, if it's remote by itself.

My view is there is still opportunity to come for better value in prime stock - (holiday/retirement).

Gosh,

That looks barren and remote. I am not so confident it is a good price. I think you are right about discounts in prime stock.

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It is not a complete shell. It had been lived in for a couple of years, it just has been striped by thieves/vandals. It is tiled the walls and ceiling like good. The wiring is there, the piping is there and bath and showers are there. All the shutters are there however half of the window frames have been taken out. Plus half the kitchen is there. I reckon it would take €30K to do up nicely. I would be tempted if I get it finished and done up for about €200K another €10K should do the pool.

Here are some pictures. Advertised for €230K needs about €30K spending on it. so €260K before purchasing cost. I am tempted by €200K for the finished article.

Land price alone (1100M2) is about €60K in current market after heavy discounting

Any comments welcome.

house 1.jpg

house2.jpg

house3.jpg

house4.jpg

post-2364-0-41047600-1401197667_thumb.jpg

post-2364-0-46171700-1401197675_thumb.jpg

post-2364-0-36639500-1401197686_thumb.jpg

post-2364-0-64827100-1401197696_thumb.jpg

Edited by soldintime
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The euro crisis was a while ago. But what we have seen at the European elections that Europe's problems are far from over. Spain is fighting with high unemployment and deflation. So what would leaving the euro do to Spain. Here is an interesting read.

http://www.businessspectator.com.au/article/2014/5/26/european-crisis/what-spanish-exit-euro-would-look

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I have been doing some more detailed research into possible areas of opportunities in Spanish real estate. My initial focus was areas which have had a severe price drop, but still close to big cities or beaches. I have been looking at an area 35 mins from centre of Barcelona and 10 mins from beach, where 4-5 bedroom detached 200 sqm+ houses go now for €190-280K, with land area of 600-1000 sqm. My initial house house i looked at was a 6 bedroom house with 1000sqm land, built in 2007. The house was empty for the last 3 years. The place was stripped bare, no electricity sockets, heating system stripped, window frames stripped, doors, toilets, sinks, kitchen all striped. Grass 1 meter high, place completely over grown. I can see banks that have repossessed have no incentive to keep place up as the owner will still be responsible for the debt until they die, unlike the USA. Initially I was attracted to the opportunity, however I was shocked about the state of the house 3 years after it was abandoned. Also the urbanization was not that well maintained anymore, with public paths overgrown. This is not your typical Brit / expat urbanization, but more a 25% full time and 45% spanish, 30% foreign owned urbanization. This place was initially over 550K in boom times, now advertised for 220K. I reckon it can go lower. I may make a cheeky offer....

as MAXD said - cost of new build in Catalonia is about €1000sqm, cost of land is anywhere from 50-120 per sqm (discounted), so look for deals that are 30-50% below.

It is not a complete shell. It had been lived in for a couple of years, it just has been striped by thieves/vandals. It is tiled the walls and ceiling like good. The wiring is there, the piping is there and bath and showers are there. All the shutters are there however half of the window frames have been taken out. Plus half the kitchen is there. I reckon it would take €30K to do up nicely. I would be tempted if I get it finished and done up for about €200K another €10K should do the pool.

Here are some pictures. Advertised for €230K needs about €30K spending on it. so €260K before purchasing cost. I am tempted by €200K for the finished article.

Land price alone (1100M2) is about €60K in current market after heavy discounting

Any comments welcome.

Sorry but it looks like a prison holding facility, or some scary villain's compound. Landing isn't wide but perhaps that's just my eyes being drawn to fact the railing has gone. Even the stairs though, more risk of a tumble. Fugly house.

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