The fall in Spanish home sales accelerated in the final quarter of 2008, a report showed on Tuesday, reflecting a collapsing property sector that has helped tip the fourth-largest euro zone economy into recession.
Some 113,274 homes were bought and sold in the fourth quarter, down 13.5 percent from 130,884 in the third, Spain's College of Registrars said.
The drop was sharper than a 8.6 percent fall between the second and third quarters.
For the year, 561,420 sales were registered, down 28.8 percent from 2007.
The average value of Spanish mortgages declined for a fourth consecutive quarter, falling 1.84 percent year on year to 136,148 euros ($174,400), the college said.
Average mortgage values fell 6 percent in 2008, it said.
Figures from Spain's National Statistics Institute published last month showed mortgages in Spain fell 23 percent in November compared to a year earlier, reflecting both weaker demand and tighter bank lending.
Most analysts say Spanish house prices will fall by up to 30 percent from their highs, though some see greater declines as possible as the end of a decade-long residential construction boom coincides with credit market turmoil. Add into this the cost of buying euros and the Spanish property market seems to be in some pain.
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Showing posts with label Spanish Mortgages. Show all posts
Showing posts with label Spanish Mortgages. Show all posts
Monday, March 2, 2009
Tuesday, August 12, 2008
Spanish Banks feel the Housing Market Crash
Spanish banks could be next in line to feel the global financial crunch, the WSJ reports.
They say that with Spanish housing market bust taking a toll on Spanish builders, Spanish homeowners and the broader economy, the outlook is dimming, particularly for Spain's system of local savings banks, which generate roughly half of the country's lending and deposit-taking.
Bye For Now
Best Euro Exchange rates when you need to Buy Euros
They say that with Spanish housing market bust taking a toll on Spanish builders, Spanish homeowners and the broader economy, the outlook is dimming, particularly for Spain's system of local savings banks, which generate roughly half of the country's lending and deposit-taking.
Bye For Now
Best Euro Exchange rates when you need to Buy Euros
Monday, August 4, 2008
Spanish property prices have fallen by 30% say estate agents
Spanish property prices have fallen by 30% say estate agents
Spanish property prices have fallen by 30% since Spain’s economic downturn began last year, says Santiago Baena, president of the API real estate agents association (Colegios Oficiales de Agentes de la Propiedad Inmobiliaria).
Speaking at a recent conference on Spain’s property crisis, and reported in the Spanish press, Baena said that the adjustment in Spanish property prices currently underway is brutal, and that the situation this year is radically different to last year, when the sector was already absolutely paralysed.
Spain’s construction sector won’t stabilise and start to recover until 2009, forecasts Baena.
Baena also pointed out that many of the sector’s problems are due to a lack of regulation in the sector, and called for more legal protection for consumers. He recommends stronger legislation and the introduction of professional qualifications for real estate brokers. According to Baena, minimum rules of the game are needed to prevent a market of the law of the jungle in which anyone can operate without any code of conduct or oversight.
He also called for a reform of local government financing, so that town councils don’t have to rely on the construction sector for their finances. Baena described the present situation as shameful, and called for new legislation.
Baena then had a go at banks, who he said lent with enormous generosity in the good times, but whoSpanish Banks now won’t lend to anyone. He accused them of doing a disappearing act when the going gets tough.
Despite everything, Baena argues that now is a good time to buy property in Spain.
Read More at Spanish Property Insight
For the Best Exchange Rate when Buying Euroscontact IMS Foreign Exchange
Spanish property prices have fallen by 30% since Spain’s economic downturn began last year, says Santiago Baena, president of the API real estate agents association (Colegios Oficiales de Agentes de la Propiedad Inmobiliaria).
Speaking at a recent conference on Spain’s property crisis, and reported in the Spanish press, Baena said that the adjustment in Spanish property prices currently underway is brutal, and that the situation this year is radically different to last year, when the sector was already absolutely paralysed.
Spain’s construction sector won’t stabilise and start to recover until 2009, forecasts Baena.
Baena also pointed out that many of the sector’s problems are due to a lack of regulation in the sector, and called for more legal protection for consumers. He recommends stronger legislation and the introduction of professional qualifications for real estate brokers. According to Baena, minimum rules of the game are needed to prevent a market of the law of the jungle in which anyone can operate without any code of conduct or oversight.
He also called for a reform of local government financing, so that town councils don’t have to rely on the construction sector for their finances. Baena described the present situation as shameful, and called for new legislation.
Baena then had a go at banks, who he said lent with enormous generosity in the good times, but whoSpanish Banks now won’t lend to anyone. He accused them of doing a disappearing act when the going gets tough.
Despite everything, Baena argues that now is a good time to buy property in Spain.
Read More at Spanish Property Insight
For the Best Exchange Rate when Buying Euroscontact IMS Foreign Exchange
Tuesday, July 22, 2008
Spanish Mortgages
Spanish Mortgage Information
Buying a home or an investment property in Spain has soared in popularity in the last 10 years. The ability to borrow money to do this however has not quite kept pace with the demand from Northern Europeans for cutting edge mortgage products. That said there is a wide and growing range of mortgage products available for non residents of Spain.
Spanish Mortgage Products
Mortgage lending in Spain can be either at fixed or variable rate and on a repayment basis or interest only basis. Spanish mortgages are generally linked to the yearly euribor (European inter bank offered rate) which means that the rate of borrowing against which you pay interest will be reviewed yearly. Through Gibraltarian and Isle of Man banks we can provide mortgages in sterling for Spanish homes.
Loan to Values
Spanish mortgage loan to values are up to 80% for non-residents of Spain. The loan percentage is linked to the mortgage security valuation the lender assesses upon the property you choose not the price you are buying it for.
Equity Release and Re-mortgaging in Spain
Not all Spanish banks will consider allowing you to either remortgage once you have started your mortgage contract with them (you can always consider changing banks however) and releasing equity is again restricted to certain specialised lenders. Remortgageing and releasing equity can be a costly process and should only be done under advisement.
The Bank of Spain controls the activities of lenders in Spain and releasing further funds or changing the terms will incur further tax; bank and notary costs. Under Spanish legislation it may be prudent to mortgage to the maximum you require and include future needs to avoid the enhanced costs later on.
Spanish Mortgage Terms
Spanish mortgage terms range from 5 to 40 years, are age and lender related. It is usual to have repaid the mortgage by age 70 but this can be extended to 80 with some lenders.
Mortgage Costs
All Spanish banks charge an arrangement fee for lending you the money, this ranges from 1% to 2% typically and is payable at the Notary at completion. Other costs including mortgage taxes and some of the deed costs are deducted from your mortgage advance. It is rarely possible to add your costs to the Spanish mortgage unless your valuation level allows you to. You should allow in the region of 12% to 13% of the price of your house to cover your costs in Spain in full. You should contract an independent Spanish lawyer, not one recommended by your agent or developer, to help with the purchase and make sure you are made fully aware of the provision of costs for completion by your lawyer.
Buy Currency
Your Spanish mortgage will be repayable monthly in Euros. To buy Euros at the best rates click here.
Underwriting
Most mortgages in Spain are only granted on a full documentation and status basis however there is limited access to self certified lending. You should not expect the most favourable terms for this type of lending. Spanish banks assess the lending against a percentage of your disposable income unlike UK banks that tend towards lending you a multiplication of your annual income.
Hints & Tips
1. Check your budget and make extensive mortgage enquiries before even travelling specifically to view Spanish property. It would be a wasted trip and quite heartbreaking to see your dream home and discover you cannot borrow the amount you need to buy it.
2. Always use an independent Spanish lawyer to act for you. Do not go on the recommendation of your agent, developer or the seller.
3. Be prepared for hiccups along the way. Spanish law differs from that which you are used to. The Spanish use a Notary system that is long, drawn out and expensive.
4. Do not sign anything until your lawyer has checked the paperwork and your finances are in place. You could end up losing a deposit.
5. Do not get drawn into financial structures such as using companies and offshore havens to purchase the house until you have thoroughly understood the implications of doing so.
Buying a home or an investment property in Spain has soared in popularity in the last 10 years. The ability to borrow money to do this however has not quite kept pace with the demand from Northern Europeans for cutting edge mortgage products. That said there is a wide and growing range of mortgage products available for non residents of Spain.
Spanish Mortgage Products
Mortgage lending in Spain can be either at fixed or variable rate and on a repayment basis or interest only basis. Spanish mortgages are generally linked to the yearly euribor (European inter bank offered rate) which means that the rate of borrowing against which you pay interest will be reviewed yearly. Through Gibraltarian and Isle of Man banks we can provide mortgages in sterling for Spanish homes.
Loan to Values
Spanish mortgage loan to values are up to 80% for non-residents of Spain. The loan percentage is linked to the mortgage security valuation the lender assesses upon the property you choose not the price you are buying it for.
Equity Release and Re-mortgaging in Spain
Not all Spanish banks will consider allowing you to either remortgage once you have started your mortgage contract with them (you can always consider changing banks however) and releasing equity is again restricted to certain specialised lenders. Remortgageing and releasing equity can be a costly process and should only be done under advisement.
The Bank of Spain controls the activities of lenders in Spain and releasing further funds or changing the terms will incur further tax; bank and notary costs. Under Spanish legislation it may be prudent to mortgage to the maximum you require and include future needs to avoid the enhanced costs later on.
Spanish Mortgage Terms
Spanish mortgage terms range from 5 to 40 years, are age and lender related. It is usual to have repaid the mortgage by age 70 but this can be extended to 80 with some lenders.
Mortgage Costs
All Spanish banks charge an arrangement fee for lending you the money, this ranges from 1% to 2% typically and is payable at the Notary at completion. Other costs including mortgage taxes and some of the deed costs are deducted from your mortgage advance. It is rarely possible to add your costs to the Spanish mortgage unless your valuation level allows you to. You should allow in the region of 12% to 13% of the price of your house to cover your costs in Spain in full. You should contract an independent Spanish lawyer, not one recommended by your agent or developer, to help with the purchase and make sure you are made fully aware of the provision of costs for completion by your lawyer.
Buy Currency
Your Spanish mortgage will be repayable monthly in Euros. To buy Euros at the best rates click here.
Underwriting
Most mortgages in Spain are only granted on a full documentation and status basis however there is limited access to self certified lending. You should not expect the most favourable terms for this type of lending. Spanish banks assess the lending against a percentage of your disposable income unlike UK banks that tend towards lending you a multiplication of your annual income.
Hints & Tips
1. Check your budget and make extensive mortgage enquiries before even travelling specifically to view Spanish property. It would be a wasted trip and quite heartbreaking to see your dream home and discover you cannot borrow the amount you need to buy it.
2. Always use an independent Spanish lawyer to act for you. Do not go on the recommendation of your agent, developer or the seller.
3. Be prepared for hiccups along the way. Spanish law differs from that which you are used to. The Spanish use a Notary system that is long, drawn out and expensive.
4. Do not sign anything until your lawyer has checked the paperwork and your finances are in place. You could end up losing a deposit.
5. Do not get drawn into financial structures such as using companies and offshore havens to purchase the house until you have thoroughly understood the implications of doing so.
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