cricketman

Tourism has very little to do with property prices.

There is so much cheap holiday acommodation on the CDS then you would need a huge amount of business to get back anything on your investment. And anyway, there are so many foreigners who own houses here that almost everyone in the UK at least knows a family member or friend who lives abroad where they can stay for free or at mates rates

steviedeluxe

I agree with your logic, but some people base property prices on the costas, on what rental income they can derive from tourists. It's a bit like London prices where a house's value is high because the BTL landlord can rent out each room to migrant workers. It doesn't matter if the average wage in East London is 20k, as the landlord will still earn from renting out each room. A house there could cost 300k, whereas in Bradford it would only be 80k.
Of course there are probably too many holiday homes, so I agree prices have further to fall.

bil

Astute point. If your money is in euros, and that is your living currency, then how it goes up or down doesn't really matter (IMO) If tho you have it in another currency. a shift one way will benefit, but a shift the other way could ruin you.

You forgot the massive over build.

IMO that, together with the other two points you raise will keep it down even worse.

cricketman

Sure, but the most people can hope for its 16 weeks a year at £1000 a week for say a 3/4 bed villa currently costing £400-£500k plus

And most people get much less than that.

It simply doesnt make sense. This business only works for people who bought 10-15 years ago at one third of the price.

I should add that there are only 2 end-games for the Spanish property market:

1. Property values drop over a period of 10 years to less than 50% of peak values
2. Property values dont drop, but the Spanish banks and country go backrupt, Spain drops out of the Euro and adopts a new currency so they can hyperflate their way out of debt taking house prices down with them

At this period of time, my money is on no.1

steviedeluxe

That was my point bil. But thanks, you expressed it better than I did!

steviedeluxe

Oh yes. And not everyone gets full occupancy every summer either. But it is the way some people think, and perhaps explains why a coastal place will cost so much more than another place 50 miles inland? Location, location location!

bil

Sorry if I stood on your post, didn't mean to.

HBG

Any expat who bought over ten years ago, and, if relying on a UK income, can cope with the 30% fall in that income over the past few years, can carry on living happily in this hot country.

An expat who bought within the last six years, and with a 70% mortgage, or more, is likely in negative equity now. If their income is sufficient, they can ride out the storm, though it may take a few years.

Those who bought more recently, with even higher mortgages and affected badly by the fall of the pound, or even worse, losing their Spanish jobs, are suffering. The obvious route of selling up in Spain may not be open to them because of the fall in property values.

I think those are the people for whom this thread was intended, and there is little hope on the horizon for them, unfortunately.

But, as Cman mentioned, the wider Spanish economy is not affected by those expats, and would be the subject of a different discussion.

Domino

OK now substitute Spain\Spanish for UK - applies equally.

the bottom has dropped out of the US housing market because of the toxic mortgage problem. Sharp salesmen in snappy suits selling mortgages to people such as 70yo black guy with no income only support from family. Dont blame the 70yo, wind the tape back to the sharp salesman. Once I realised who they were selling to - anyone with a pulse, it all fell into place. the cry was "money is cheap" has proven to be totally wrong in the longer term.

in uk the bankruptcies are running at around the 10 year average, perhaps falling a litte. Yes, if you bought a house for £35k 15-20yrs ago you would feel agreived if you couldnt get £150k for it. If however if you bought at £150k and now can only sell for £95k then u are up the creek, no paddle. The house start is probably the lowest since 1945.

Spain's problems seem to centre around the builders who borrowed silly amounts to buy land they knew had dodgy provenance. They borrowed again to build and went out and built as fast as possible, as many as possible, breaking all codes along the way. Even sold to people who now find they cannot get water or electric and are in the middle of a pile of dogs poo.

This is going to take much longer to iron out, each country is trying to address it for the best for the future. in the meantime we are all will have to learn to batten down the hatches and await the storm to blow out.
I hope it will improve in the next 12-18months, but then I originally was unsure that Stereo would work so what do I know.

jackytoo

Houses are selling well in the South east. Always sold within a few weeks.

Domino

presumably thats South of Watford ! ?

or South of Croydon ?

jackytoo

Where's Watford

Surrey, Hampshire, Dorset, Kent. Most in my area are selling for well above asking price. London has been doing well but that may change after the riots...I would be looking to get out of there!

Domino

ok then jacky, south of croydon, m25 access counties.

not truly the real world but neighbours it

cricketman

Absolutely

The difference is that most expats have their homes in the most vulnerable parts of the Spanish housing market i.e. those parts of Spain where you could buy a property for loose change 30 years ago and have completely overbuilt property that looks all the same and is of poor quality.

Someone with a flat in the centre of Madrid, Barcelona or San Sebastian is much less vulnerable then someone with a villa near Mijas. Or worse, near some urbanisation in the middle of nowhere where there are no services, no jobs and no opportunities.

The UK doesnt have as many localised property bubbles. London is a law onto itself and will probably hold up. It is probably the industrial parts of the North where you couldnt give property away 15 years ago where people are going to really suffer.

Domino

but the spanish economy is built around the town house(flat) and the country house - which is where they all are until the temperature drops.

the uk has "social problems" that makes the ownership of a country property (even when you can afford it) to be not acceptable.