In 2012, sales and turnover for Spanish Hot Properties were both up 25% on 2011For 2013 the estate agent has even higher hopes, a 50% predicted increase in turnover on 2012, largely due to a Google-friendly website that will rank strongly as the market recovers. So why the positivity?
Nick Stuart, Director of Spanish Hot Properties, based in Marbella, explains:
“Marbella is still a very desirable area of choice for international buyers, there is even a shortage of the best homes in key parts of Marbella and Puerto Banús. Considering its perfect location, at the southernmost tip of Europe therefore squeezing more sunshine hours and higher temperatures out of the entire year than the French or Italian Riviera ever will, not to mention direct year-round flight connections to Northern Europe, Russia, North Africa and North America, prices haven’t surged with such ferocity as they have on other elite coastlines.
This makes Marbella very appealing. Move further away from the centre and there are still fantastic deals to be had in secondary locations such as Estepona and Mijas Costa, which are only 25 and 30km away from Marbella respectively, but half the price.”
“Nationality-wise our sales are geographically widespread, but we expect a big increase in sales to Norwegians and Swiss due to their currency being outside of the Eurozone. The Belgians, Dutch, Russians and Scandinavians are hot on Marbella as they realise that prices are at their lowest and represent incredible value for money – even on a global scale.
Brits seem to be missing out somewhat. The two bedroom apartments selling for 250,000 euros today were priced at half a million at their peak, genuinely many properties are half price, and I don’t think the Brits quite see that. They used to dominate the market but the Russians and Chinese are hot on their tails. Perhaps the Brits will wake up and return for the bargains soon.”
Of course, the future isn’t completely bright, and Nick predicts problems when it comes to financing a property purchase and the operation of the new “Bad Bank”.
“The bank lending situation could get even worse in 2013 with a reluctance to give decent finance on homes that are not owned by the bank themselves – however in that case they are prepared to give as much as 100%. Cash buyers will be in a strong position to negotiate and will generally get discounts on properties up to the 300,000 euro mark.”
I believe that SAREB, the Bad Bank, will be a nightmare to deal with. To date, pre-SAREB, many Spanish banks have been inept at handling their repossessed stock and foreigners have been put off doing business with them. They tend to be inefficient, not always conversant in English and haven’t the incentive or motivation to focus on property sales – who says this Bad Bank is going to be any different?”
Also the Bad Bank will offer no value for our clients with very few properties that our clients actually want to buy. A large proportion of homes will be in city suburbs or non-coastal locations and most international clients wouldn’t consider housing their dogs there, let alone live or holiday in them personally. Some of the new build bank stock has sat empty for years as nobody has ever considered it worthy of purchase, just because it’s in a Bad Bank won’t suddenly make it desirable.”
“I actually have an anecdotal story that tells you everything about bank repossessions for 2013. A bank recently nationalized into SAREB had already agreed the sale of 200 luxury units in Puerto Banús with finance terms in place. Once integrated into SAREB, the Bad Bank said it was no longer prepared to give finance on those properties and these existing clients had up until 15 December 2012 to complete transactions with alternative funding. Most sales inevitably fell through.
However, one buyer sat at the notary with 500,000 euros to complete on 14 December, within the agreed timescale, but no one from the bank turned up to take his money as they no longer cared. Quite incredible. The secret is to make sure you deal with one of the major five banks in Spain and not with the struggling minnows.”