Tuesday 25 September 2007

BBVA Predict Landing will be 'soft' for Spain

A ‘SOFT landing’ is forecast for the Spanish property market, according to a new study from Banco Bilbao Vizcaya Argentaria, with demand and supply reaching sustainable levels.
“House prices have undergone a further slow-down, the moderation in demand from households has gathered pace, and the indicators of activity are starting to show some deceleration on the supply side,” the report said.
“Household spending on housing will slow in 2007 and 2008, a fall-off is expected to be intense but without turning negative in real terms,” it added. “Investment in housing is therefore expected to fall back from a growth rate of 2.8% in 2007 to 1% in 2008.”
Meanwhile a new report by the UK mortgage lender Halifax confirms that house prices in Spain have risen faster than anywhere else in Europe, surpassing even the UK market. They believe that the slowdown in the Spanish property market is a positive thing, after five years of exceptional price rises.
According to their figures, Spain’s property prices doubled between 2001 and the end of 2006, and increased by nearly 60 per cent in the past two years alone, compared to a 40 per cent average across the eurozone as a whole.
A large number of the buyers boosting the market in Spain are British, with a recent poll by the Taxpayers Alliance revealing that two in every five people in the UK are seriously considering moving abroad. This is a dramatic increase since last year and the highest since records began in 1991, with over 300,000 leaving in the last year, with Spain one of the most popular destinations.
According to Halifax, Austria and Portugal experienced the lowest price increases in the period since 2001, with prices rising by six per cent and seven per cent respectively, while prices in Germany fell by five per cent.
Despite the massive increase in prices over the past five years, Spain is still one of the cheaper eurozone countries in which to buy property, with prices averaging at £150,200, compared to an average of £187,100 in the UK.

Monday 24 September 2007

Young Spanish offered money to fly the nest

Spain’s struggling twentysomethings are to receive cash handouts to help them to move out of their parents’ homes.
In an attempt to tackle a big housing crisis – and capture young voters – the Socialist Government is to offer €210 (£150) a month to those aged 22 to 30 whose salary is less than €22,000.
The move comes after a ten-year housing boom that has sent property prices rocketing by 150 per cent and left thousands of young Spaniards unable to afford soaring rents. Many are living with their parents until well into their thirties.
Prices have been pushed up partly by the voracious appetite of British investors and holiday-home buyers to snap up villas in the Spanish sun. In a series of mass demonstrations across the country over three years, thousands of low-income Spaniards have demanded more affordable housing.
With six months to go before the general election next March, cheaper housing will be a significant issue for all parties.
With his eye on the youth vote, José Luis RodrÍguez Zapatero, the Prime Minister, unveiled a Bill to help young people to pay for their own accommodation. The grants will run for four years and renters can also qualify for a one-off payment of €600 (£420) towards their deposit.
When the scheme starts in January, about 180,500 people will benefit from it at a cost to the Government of €436 million. The Government also plans to allow renters whose annual incomes are less than €24,000 to benefit from tax cuts as property buyers from January, a measure that will cost €348 million in lower tax receipts.
Mr Zapatero called the plan the “emancipation of the youth” and claimed that eight out of ten young Spaniards earned less than €22,000 and would benefit from the payouts. He added: “You know that for many Spaniards housing is one of their main problems. I think today we are taking a big step in the right direction.”
The conservative opposition Popular Party attacked the plan as blatant electioneering. Eduardo Zaplana, a spokesman, said that the Socialists had failed to deliver on previous plans to build 180,000 subsidised housing units and had not honoured promises to make it more attractive for landlords to rent out many thousands of unoccupied properties. He said: “How can the Prime Minister do this after the housing issue was so important in their earlier programme and they have not fulfilled anything at all?”
Just as for many Britons, a Spaniard’s home is his castilla, so owning one is many people’s dream. Many are so desperate to get on to the property ladder that they have taken out mortgages for their whole lives. Most do not want to pay rents, which have been on the rise for a decade.
Average rents in Spain are only €720 a month, but in Madrid, Barcelona and San Sebastián landlords can charge almost double. In the capital the average rent is €1,138.
Staying put
— Less than a third of Spaniards between the ages of 25 and 30 had left home in 2001, compared with more than half in 1977
— An estimated 10 per cent of Scandinavians aged 18-34 live with their parents
— In northern Europe the overall figure is somewhere between 15 and 30 per cent
— In southern Europe it stands at approximately 60 per cent
Sources: Network on Transitions to Adulthood; eurofound.europa.eu; Times archives

Thursday 6 September 2007

Foreign investment in Spainish property up by 19%

Figures from the Bank of Spain reveal that foreign investment in Spanish property increased by 19.2% in the first 5 months of the year compared to the same period in 2006.
The total amount invested by foreigners to the end of May was 2.252 billion Euros, almost the same as the amount invested in 2005, though still significantly below the 2.925 billion Euros invested in the peak year of 2003.
The figures do suggest that foreign demand for Spanish property has picked up significantly since last year, even though reports say that the market is still very slow. By the end of the year we should know whether foreign demand has rebounded, or whether these figures can be explained by some other factor.

Tuesday 4 September 2007

One million Brits now living in Spain


An estimated 1 million Brits now live in Spain – and after decades of Little England mentality, there are signs that the expatriates are integrating at last into the Spanish way of life.
Graham Forster may have come to Spain partly in search of the sun, but sea and sand can’t have had too much to do with it. The pretty Andalusian village where he has settled is a 40-minute drive from the coast – or would have been had I been able to find the winding road to it on my map.
Eschewing the concrete costas and looking inland, the 49-year-old Liverpudlian watchmaker found a perfect place to settle in Álora, a whitewashed village in the shadow of an ancient hilltop castle. “I wanted the Spanish lifestyle, rather than Little England in the sun,” he explains, taking a rest from fixing clocks in the afternoon heat.
Five years ago, he moved here with his family and enrolled his son Jonathan and daughter Jessica in the local school. After four years of lessons and considerable help from his neighbours, Forster felt that his Spanish was good enough to open his own shop, which serves Brits and Spaniards in equal measure. “This is it now,” he says decisively. “We’re staying here for good.”
Álora is one of dozens of remote Spanish villages where Britons have settled in recent years. Far removed from the British enclaves on the coast, many of these latest settlers are becoming involved with their adopted villages to an extent their predecessors never dreamt of. But it is a slow and uncertain process with a looming catch: the more of their compatriots arrive, the harder it will be to integrate.
Even so, the latest and most intrepid wave of Britons to settle in Spain is challenging deeply-ingrained stereotypes of the dreaded “Brit abroad”. For a start, they aren’t all pensioners. “I think the traditional image of the retired Brit coming to live in the sun is diminishing,” says Bruce McIntyre, the British consul in Málaga. “The normal person who used to come here and live on their state pension can’t now afford to do so.”
Instead, he sees younger people moving over with their families, often entrepreneurial types with successful businesses in the UK. In short, the sort of person who is more likely to make a go of Spanish life, and not just wanting to live out their final years in the sunshine.
“I think the newer generation are integrating more,” McIntyre says, looking at his assistant for confirmation. “Yes, a lot of them are intermarrying,” agrees Rosslyn Crotty, who has lived in the region for 30 years. “There still is a lot of Brit-marrying-Brit. But there are also a lot marrying Spanish nationals now.” It is impossible to say with any certainty how many British live in Spain. Most do not register with their local authorities, often for fear of attracting the attention of the tax-man. That said, the estimates are huge – and growing at an impressive pace.
The UK Foreign Office works under the assumption that more than 1 million Britons are living most or all of the year in Spain – a huge number in a country of 45 million people. In dozens of towns and villages across the sunny south and west of the country, Britons now outnumber Spanish residents by a wide margin.
Recent surveys suggest that there is no shortage of others willing to make the move. In 2005, an average of 2,000 people moved away permanently from the UK each week, according to the Institute for Public Policy Research. Spain was the most-popular destination after Australia.
The latest official figures reveal that 315,000 Britons are registered with their local Spanish authority, giving them the right to vote in local elections. That figure is rising by 15 to 20 per cent a year. For the first time, Spanish politicians are starting to court the British vote in local elections. In places such as Majorca and Alicante province, Britons are themselves being elected as local officials; one town has even had a British deputy mayor.
Karen O’Reilly, a British anthropologist, conducted a now-famous study into The British on the Costa del Sol. During her fieldwork in Fuengirola 15 years ago, she found that the British and Spanish hardly mixed at all. “If you could draw it,” she says, “you’d have a Venn diagram with very little overlap.” On recent trips, however, she has begun to notice tentative signs of change. “People are now becoming more involved in the Spanish economy,” she says. “They are learning little bits of Spanish. It’s not a massive sea-change, but it is changing.”
Full story from timesonline.co.uk

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