Hello!

I am considering purchasing a first floor apartment on Rago 1 with a wrap around terrace overlooking a pool for 99,000 euros. I am all for the idea as I feel it would be an excellent investment. Many friends and family have advised me against it however as there is this idea that properties in Spain are now two a penny and losing value by the day! Please advise me as I am really unsure what to do....

Jon

We are in the same position as you Jon - we are hoping to buy on Esuri within the next year or so - i still think bricks and motar are a sound investment (if you are NOT looking for a quick return that is) - we are first looking for a holiday home with the hope of making it a more permanent move - i think Esuri is for the long term - until the hotel n people coming on holidays not much more will sell as i think the hotel to drag people in is a must - but from what ive heard Fadesa are looking at stupid money - it would be a domino effect if it was sold n completed to get the golfers in who would then probably start looking at apartments, houses, villas etc.
So - i think it will be 15 or 20 years before its complete on there - maybe more - how long is a ball of string - but until then we are still going to buy on Esuri n enjoy our holiday home until we can move out there more permanently

Good luck in whatever you decide Jon xxxxx

I would wait until next year, all the "experts" say that prices haven't reached the bottom yet.

Oh good - maybe i will be able to afford a villa then

Prices peaked in Spain in 2007 since when they have dropped on average around 30%. The latest information I have is that prices are now bottoming out. Based on the price you quote, that apartment has been discounted by 40% at least since 2007 so I think it's a very attractive price and unlikely to fall in value. Ownership of these properties has passed to a bank and they are priced to sell. Prices aren't going to up either in the short term so you can also wait if you prefer although you then run the risk of someone else stepping in and buying the apartment you want. Overall I agree with the great American investor, Warren Buffet, who said, "You should be cautious when others are being greedy and greedy when others are being cautious". If you have the means, this is the best time to be buying.

This webpage might prove some useful info, albeit it seems a bit commercial:http://www.propertyshowrooms.com/spa...ng_287114.html

Have you visited the area already?

Prices all over Spain will continue to go down for another year or so.

This is last years empty properties and more have been built since.
Not a bad guess on the unemployment total for now though, maybe a tad low but very close.

What if the 2 golf courses don't survive this downturn? What is the value of a property on such a complex with an already abandoned Shopping Mall and one or more abandoned Hotels.

What about the marina?

Golf complexes all over are struggling because there are just too many courses and not enough customers. I have no knowledge of sailing perhaps there is a need for a marina if so it will bring business. Don't boat owners like to use marinas where they can top up supplies fuel etc. with a short walk into shopping areas?
I,m thinking of Villamoura down the coast on the Algarve.

The boating industry has collapsed as well in recent years. Prices of moorings and the boats themselves have plummeted

I think we are 2-3 years away from a bottom in Spain and when we get there I think we'll stay there for a while.

I would be worried about buying in a development that was already in a difficult situation financially. It could end up like living in a ghost town and the property being virtually unsellable.

Still, 99k for say a newish 2 bed apartment anywhere on the Costas is starting to sound like good value.

I agree with c/man. Could turn out to be a bargain but I reckon the marina and hotel are pie in the sky at the moment. The place could even become more neglected in the future. Better to find a bargain in an established urbanisation.

I agree with you. There must be bargains to be had that don't rely on a golf course being viable.

Thanks to everybody for their advice. I do believe it has helped me decide to wait a while longer...

Thanks!
Jon

For info on values etc go to Kyero.com Really useful site