Posted on 01/19/2013 1:49:18 PM PST by Lorianne
SPANISH house prices could drop by a further 50% and may not recover for the next 15 years, according to experts.
The Costa del Sol is among the worst affected areas in the country, with the total fall in values predicted to be as much as 75% in some areas.
There are 800,000 used homes on the Spanish property market, with another 300,000 having been foreclosed by the banks and a further 150,000 in foreclosure proceedings.
What’s more, developers have 700,000 completed units not on the market and another 250,000 still under construction.
“The market is broken,” said Fernando Rodriguez de Acuna, vice-president of Spanish economic consultancy RR de Acuna & Asociados.
“In places like Castellon, near Valencia, where over-development was mad, banks are not financing anything and there is a high probability these properties will never be sold. They will have to be knocked down.
“Banks are offering huge discounts and nobody is calling. Marbella has already fallen by 50% and prices are going down and down.”
“SPANISH house prices could drop by a further 50% and may not recover for the next 15 years, according to experts.”
The government will not last that long.
Now I understand why my friends, after having lived in sunny Costa del Sol for so many years, decided to go back to cold, dreary and wet Belgium.
The same will happen in the US, too.
This what happens when you deficit spend for three generations, become decadent, less productive and stop procreating. Soon waves of North Africans will be settling into those abandoned and cheap properties. The future belongs to the fertile.
Get a cheap house but the commute is killer.
Their situation is basically the same as ours in that they also built HUGE NUMBERS of unneeded (and now empty) houses...and they need to let prices drop to the point where people move out from being with their parents or friends and start buying these places. Spain is trying but is not doing enough to get that going...we are going the other way, just to make sure the real crash is much, much, worse.
“The gain in Spain falls mainly down the drain.”
Bump for reference.
As I understand it...Spain for years had a rule about foreign ownership...so you had a bunch of guys who acted as middle-men and arranged the purchase, and just counted on retirees to continue to pay. Well...the middle-guys got caught up in a massive build-up, and never expected the market to dry up so quickly, or for pension-fund people to suddenly lose all their real savings.
What you have left are modest and small apartments or cottages, which are all out near the beach regions.
I took a vacation to the Canary Islands back in the late 90s. Actually did a tour of a cottage, which the real estate guy was talking up for roughly $50k but it was barely 800 square feet, and with no frontyard (barely a 30 x 30 foot spot for the backyard). This ownership role that he was going to play bothered me. I’d never really own the property myself. Then I figured out the electrical costs....almost the same monthly bill as the mortgage.
Actually, the kenyan marxist is working diligently to break the US.
“I took a vacation to the Canary Islands back in the late 90s.”
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A Swedish friend of mine got tired of third world life here in the Philippines.
He and his Philippine wife tried Malaysia, but he grew tired of the Muzies.
They then moved to Canary Islands a few years ago and seem to like it very much.
One bonus for the Philippine wife...She became an automatic citizen of Spain, as Spain had once ruled the Philippines.
It did. We still have about a 15 year overhang of empty housing in this country. The residential construction business throughout the nation was devastated by overbuilding done by cheap Hispanic labor.
Spain is just catching up to us.
NOTE: Widespread use of SIP construction helped ~ that reduced the labor requirements on site like nobody's business. This induced builders to become ever more competitive ~
Greatest Real Estate Bubble In Modern History Not Done Bursting
http://www.forbes.com/sites/greatspeculations/2012/10/03/greatest-real-estate-bubble-in-modern-history-has-yet-to-really-burst/
Is another California housing bubble possible?
http://www.zerohedge.com/contributed/2012-12-29/another-california-housing-bubble-possible
Well, they may or they may not.
The experts don't know jack-squat about the future any more than the rest of us. What a silly article.
What is even scarier, is in order to keep Spanish T Bill prices from dropping (and interest rates rising), Spanish gov is using the money from the national pension fund to buy T Bills that private investors refuse to buy. When the pension funds run dry and the Spanish economy does not recover, guess what Spaniards will find out that their pension funds are now broke.
Well, these McMansions could be demolished to make way for the other highly successful Spanish venture, windmill generators. ;’) Thanks Lorianne.
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