Spanish Property: Not Rocket Science
July 20th, 2010
I think this week’s news articles are pretty self explanatory. I particularly like the one about President Zapatero being compared to Mugabe regarding property rights.
I agree with Mike’s comment “while it was a silly comparison, its important the pressure is kept on the Spanish government. Unfortunately it usually takes wild accusations to get politicos to act.”
After my analysis of Spanish house prices last week, I had a call from a journalist writing for The Guardian.
I stand by what I said to him regarding Spanish property:
- Ignore the asking price
- Buy for the lifestyle, not the investment
- Buy where you can resell to Spanish buyers
Not rocket-science by any means, but the journalist was surprised I was prepared to speak so candidly. In my view, most of the mess we’re in now is due to a lack of solid information and realism about the Spanish property market. The way back to a more ‘normal’ market isn’t via hype and oversell, it’s about acknowledging reality and helping people make sensible and pragmatic buying decisions.
Speaking of sensible and pragmatic, the 2010 AIPP guide to buying overseas property safely is due out soon. I’ll let you know as soon as it’s available.
Keeping an eye on the Euro / Sterling exchange rate can be a nerve-racking pastime. At Kyero, we have a fair amount of currency exchange to do and it’s always difficult to choose the right time and the best rate to make a trade.
Less than three weeks ago, the mid-market rate was 1.235 – now that’s dropped to 1.184 – a decrease of just over 4%. What this means in real terms is that if you had exchanged £200K three weeks ago, you’d have got €247K, today you’d get €237K – €10K less.
There are a number of legal costs and taxes when buying a property in Spain – and that extra €10K would go a long way towards meeting or offsetting them. If you intend to buy property in Spain, have a chat with your favourite currency broker about forward buying and locking-in an exchange rate you can live with.
Martin Dell, Kyero.com
Martin, your point number 3 is particularly salient. Any buyer should always focus on reselling what he intends buying and that is all about making sure that the property concerned will suit the biggest possible section of the property buying marketplace. I make this point in detail in my ‘How to Move to Spain Safely’ book – in which I point out that any buyer should always be looking to resell into a ‘mixed’ market. Obviously, therefore, any property should appeal to the Spanish (the largest market!) as well as Internationals. Equally, care should be taken to avoid buying properties built on many levels when on steep plots. Anyone elderly, infirm or with small children or grandchildren (a large section of the population) will be put off. Buying safely in Spain is not something to be done without considerable thought and know-how..
I agree with CultureSpain. I am actively looking for a large appartment in the centro historico de Malaga, not only because i love the old city, but i think it would be much harder to resell a villa or appartment on one of the coastal resorts/towns.
I think its also safer if one is buying in an old protected building in the centre of Malaga, as the Spanish have a lot less tolerance for scammers operating within the Spanish Spain..if that makes any sense