Re: This could change everything
 

It's amazing what you can learn if you just know a bit of Spanish.

Re: This could change everything
 

Unfortunately the problem is that anyone who has invested in property in Spain, be they Expats, Spaniards or businesses now have no value whatsoever.
Previously there was a little hope in realising a reasonable, realistic value.
Now there is no hope of realising any value.
Not a great problem for someone who is settled for the remainder of their life, but for others a disaster.

Re: This could change everything
 

From the article:

So there will soon be a new job available: house sitter. The worker will be responsible for picking up the mail (mainly bills from the bank), turning on the lights and running a shower every day in a dozen or two houses. That will run up the bills showing that the properties aren't empty. In return for paying these bills, the worker gets to live for free.

... where do I sign?

Re: This could change everything
 

What do you call a realistic value?

My ex-landlord in Benalmadena bought his flat for 50k euros in the 90s, he had it up for sale for 3 years at 400k and 1 year ago brought that down to 350k

It is a nice-ish flat, maybe for a slightly above average family in terms of income

An average family may earn 18,000 euros per year in the Benalmadena. An above average one may earn 30,000 euros per year

A multiple of four is considered healthy in relation to annual income and property value, so that flat should be up for sale for 120k euros, not 350k euros

An increase from 50k to 120k in 20 years would be considered reasonable

It's the same here in Oviedo. A decent large 3 bed flat costs 350k euros or more. Now 5 years ago these were up for sale at 500k euros. Looking at salaries in this area, ther real value should be around 150k-200k euros

We still have not seen property values fall by anywhere near enough in the areas where Spanish people actually live. Some of the expat areas are a bit different as in some of these areas there are not actually any jobs or industry, so the value of their properties can be argued to be neglible

Re: This could change everything
 

I think you have answered the question yourself.

Re: This could change everything
 

Sigh. I don't know where to begin with the irony list in this discussion.

I reckon it speaks for itself, though.

(another sigh)...

Re: This could change everything
 

So you agree that properties are still vastly overvalued in Spain. Good

Your previous post made me think otherwise

Re: This could change everything
 

One way (though one that produces results most people don't want to hear) is to look at the rental cost of places that are actually being rented successfully.
You'd reckon that the rent an occupant pays would be roughly the same as the cost of a mortgage, plus a little more for overheads and profits.
For the sake of argument, let's assume a mortgage rate of a nice round 5% (that actual number doesn't matter to illustrate the principle). Let's also assume that the occupant is paying 1000€ per month, and that this covers a 100% mortgage, costs and profit - which between them needs an 8% return on the value of the property.
In that case, the 12,000€ annual cost represents 8% of the value of the property. If the rent was too high, more people would pile in to the buy-to-let market and push rents down. If it was too low, more people would stop renting and buy instead (assuming they could get a mortgage).

So if 12,000€ is 8% of a property's value, then it follows that the true value of the property would be 150,000€. The only question that remains is: how much are people paying in rent?

Re: This could change everything
 

Yes, properties are overvalued relative to the economy (IMHO) - but that's a matter of what sellers are asking (arguably "market value"), not because the banks are attempting to look healthy.

But I reckon the same logic would apply to your previous notion that all of it is just a big negative propaganda campaign waged by those who are jealous of Spain's sunshine.

Re: This could change everything
 

I meet different expats, and incoming expats on a daily basis. I met two prospective incomers today, a nice couple around ten years under retirement age.

We had a decent conversation about normal things, mostly Spain related, until one of them said they were on an inspection trip to buy a property in Spain. They obviously wanted me to say something, but I couldn't.

They had a fancy iPad and I should have referred them to this thread, and a trillion others. I didn't, I made my excuses and left. I didn't have much time anyway and it would have taken too long, and I'm a bit fed up explaining why buying property in Spain at this time is not a good idea. They don't listen anyway.

Re: This could change everything
 

The article is now available in English.

This bit will be reassuring for British property owners:

Read the whole article here:

http://elpais.com/elpais/2013/04/09/...83_427216.html

Re: This could change everything
 

That actually sounds rather rational. Am I just dreaming this? Pinch me.

Re: This could change everything
 

The unemployed aren't asking for handouts, they're asking for the opportunity to work for a living wage. They have their fishing rods at the ready but aren't allowed access to the lake, in your analogy.

If the system can't provide those who want to work with a living wage, then it has failed.

Re: This could change everything
 

Blame the system, blame the Government..blame anyone but ourselves..

Our employment, our health, our education and our style of living are our responsibility.

Re: This could change everything
 

Err ok, so given that the unemployment rate has shot up from 8% to 26% in Spain over the past 5 years, then the actual unemployed are to blame?

What kind of logic is that? So millions of Spaniards have just decided to give up work, lose their homes and go hungry?