Friday, December 28, 2012

What went wrong with our pension pot?

Costa del Crash! Spain's property prices set to slump 50pc

"Up to 2million properties languishing on the market that cannot be sold 400,000 Britons either live in Spain or own a holiday home. Experts warn house prices may not begin to recover for up to 15 years". (Reuters report Spanish banks in new malaise). Nationalised Bankia's share price dropped 14 per cent on Thursday after it was described as having 'negative value' of -£3.5billion (Telegraph). "Santander recently attempted to get rid of its unsold property portfolio by cutting prices by 60 per cent" the Mail continues.

Posted by alan @ 07:35 PM (2298 views)
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5 thoughts on “What went wrong with our pension pot?

  • Thank goodness this couldnt possibly happen in the uk.

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  • Most Spanish properties are built from pot blocks and render and if not continuously maintained start to rapidly deteriorate with isolated properties such as finca’s being rapidly stripped of anything of value if left empty especially if owned by foreigners.

    Spain will end up like Greece all on the back of its holiday/retirement housing bubble, if we ignore all the stupid ex-pats who were sucked in as they are generally carrying losses that will die with them it is the Spanish people themselves who are suckered. From the end of Franco’s rule in 1975 to EU membership in 1986 and relatively easy money (membership incentive grants or bribery) was a very short and dazzling time for a country that came to rely too much on the ‘costa del sol’ effect and the baby-boomers who loved the place so much they wanted a piece of it for their retirement.

    Will Golf resorts be the next big looser for the Banks, is golf mainly a baby boomer sport?

    Expect bigger losses for all Spanish banks and more domestic strife for Spain in 2013.

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  • stillthinking says:

    Or you can buy a property in Spain, be self-employed in the UK, and claim your UK rent against your PRE-tax income as a work expense. Thereby enabling large savings etc etc yawn.

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  • Adding to the problems is a continuing contraction in the Spanish banking sector which is pushing house prices even further down. Take a look at the latest numbers.

    “Spain’s housing and mortgage market

    We get an insight into this too from the latest figures for October. We see that the average mortgage value for house purchase continues to fall.

    In the case of mortgages constituted for dwellings, the average amount was 100,665 euros, 4.9% less than October 2011 and 1.7% lower than September 2012.

    We also see yet more evidence of a continuing credit squeeeze.

    The value of the mortgages constituted on urban properties was 3,088 million euros, indicating an annual decrease of 27.5%. In dwellings, the capital loaned exceeded 1,923 million euros, 18.6% less.

    These declines come on the back of substantial previous falls since 2008.”

    http://www.mindfulmoney.co.uk/wp/shaun-richards/what-is-happening-in-spains-economy-and-what-is-the-outlook-for-2013/

    So I agree that we will see further house price falls in Spain

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  • Mark Wadsworth says:

    “swathes of half-built or unsold holiday homes along the Mediterranean coast will simply have to be demolished as no-one wants them, even at rock-bottom prices.”

    ???

    These flats cost maybe £50,000 to build, and if you are half way through, it is worth spending that last £25,000 to get it finished off, even if you can only sell it for £30,000.

    Would I buy a two-bed flat in Spain for £30,000? Probably not, but it seems like a fair price to me, if you visit it once a year for the rest of your life, that works out about the same cost as a nice hotel for a week each year.

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