No Comments

Brexit “blip” puts Spanish homes dreams on hold

Brexit “blip” puts Spanish homes dreams on hold : : British buyers of Spanish real estate are Brexited Out by the antics of the EU and UK politicians. They appear to be so confused by the blitzkrieg of Brexit news and views they can’t begin to focus on their dream home in sunny Spain

As a result, Brits have missed the start of the 2019 property buying season. For decades they led the way as the Spanish property market returned to business after Christmas and Three Kings public holiday.  

Would-be British buyers would browse their favourite Spanish property websites, phone friends and family living on a favourite Costa to check for nearby bargains and make a benchmark shortlist of any villas or apartment that matched their requirements. A quick search for cut-price flights and fly to buy planning begins in earnest…

But, not this year. So far.

They appear to be taking a “rain check”. It looks like they need a short recovery period while Brexit legalities are sorted out and life can return to something like normal again.

They will have noted the new bi-lateral agreement between the UK and Spain safeguarding each countries ex-pats. Free healthcare is unlikely to be on offer if there is a no-deal brexit. And that, at last, the UK government has provided detailed information for Brits currently living in Spain and for the 1,000s more planning to relocate there – or buy a holiday home.

The British Embassy in Madrid has stepped up its information for buyers of Spanish homes and, following a Q&A with ex pats and potential buyers, will post Brexit updates on its website’s excellent property advice section.

There is new information that will be most useful to buy to let investors, most of whom find themselves taxed out of the stalled British property market. They are also facing tougher UK mortgage conditions. Many BTL investors are prepared to invest the proceeds from UK forced disposals into Spanish property. But not before the Brexit cannon smoke has dispersed and they have a clear vision of the new potential.

Living the Dream spurs property investment

Demand for Spain’s property bargains has risen quarter on quarter. In the Brexit Years, Scandinavian and Benelux buyers have been at the front of the queue for the best deals – mainly in Costa Blanca and Costa del Sol.

For British buyers, Brexit may yet prove to be just another obstacle on their journey towards Living the Dream in Europe’s favourite holiday destination. In recent years 1 in 4 property purchases in Spain were made by Brit buyers. This was despite crooked town mayors, dodgy builders, greedy bankers, dishonest developers, sales scams and metres of official red tape,

This market share is likely to continue after Brexit. Spain’s unique blend of culture, climate, natural beauty, cuisine, superior transport, beaches and Brit-friendly attitude will remain unrivalled for foreign property buyers. The Brexit blip is unlikely to stop Brits investing their favourite vacation destination.

Out of the EU, maybe. Out of Spain…Vive la vida loca.

Author: Elliott Barnett, international property writer | Image: Brexit: Which way is out of the EU? 

No Comments

Spanish bank bargains, but make sure they are legal

Spanish bank bargains, but make sure they are legal

Spanish bank bargains, but make sure they are legal : : Repossession property bargains have helped to restore the Spanish real estate market to almost its peak level of 2007 with very few legal problems for purchasers. That was mainly because the vendor banks had massive legal departments to ensure the properties on offer were fully legal or were made so.

The lawyers checked all the paperwork and despatched valuers to make sure the villas and apartments matched the relevant documents. The resultant valuations averaged 44% below the peak years of 2007-2008. Great discounts, so it wasn’t surprising buyers were tempted and that their Spanish solicitors found few legalities over which they could hassle down the price. Led by property hotspot Marbella, town hall planners compiled lists of legally built properties and made them available to buyers’ legal representatives. By default, the remainder should be double checked or avoided.

Specialist international brokers, Walker Property Spain declared all their property offerings to be “fully legal” and that “No client has ever lost a deposit or been financially disadvantaged”. Advice to “use a Spanish solicitor” from the start of the buying process came with well honed purchase management services to smooth out any wrinkles with the banks.

Know the history of Spanish bank bargains

Even with the huge discounts on offer, purchase of a repossessed property remains a serious consideration. Buyers should remain vigilant on planning consents, construction standards and permissions. Headlines a few years ago highlighted demolition orders on illegally built villas and owners trying to stave off the bulldozers.

Knowing the history of the property, its current legal state and any proposed nearby further development is vital work for every buyer’s Spanish solicitor.

Columbus finca deeds made legal

Madrid lawyer, Javier de Juan, was retained by the UK purchaser of the Mallorca Estate of the Christopher Columbus family. The property dated back to Roman times and beyond. The first name on the deeds to Son Colom da Sa Cove is Jaime Colom, uncle of Cristobal Colom – Spanish for Christopher Colombus.

It took three months to bring the ancient deeds up to date. They included cave dweller residences, a Roman silver mine, medieval alterations and additions, many boundary changes. Lawyers worked closely with the Mallorca property registry to produce the most accurate and up to date deeds in the history of Son Colom da Sa Cove.

Legal – All bank controlled property is fully legal and as such qualifies for generous mortgages as shown here. However, we advice all buyers to hire their own independent Spanish solicitor to check all paperwork, undertake conveyancing and registration and assist with utility provision etc. We can provide firms who have assisted previous buyers successfully.

Endeudamiento/DTI – This is the debt-to-income ratio, and is the percentage of your net income which your total mortgage and loan payments will represent. For example, if your net income is 3000 Euros per month, you already pay 750 Euros per month for your existing mortgage, and the mortgage applied for will have repayments of 250 Euros per month, your Endeudamiento/DTI will be (250+750)/3000 = 33%.  NB – if you are already renting out a property longterm, some banks may also include part of your rental income in this calculation

Author: Elliott Barnett, international property writer | Image:: Bank-owned bargains at Valle Romana, Costa del Sol with sea and golf views