Latest Housing Price Reports
The Spanish Network of Property Experts (Red de Expertos Inmobiliarios) new report indicates that Spanish property prices could fall up to 40% on certain types of property this year. The fall in buyer demand has reached historic lows which creates pressure on vendors to reduce their pricing. The report also highlights that the severe restrictions on mortgages will mean that the market will not begin to recover until next year. Then it will only return with slow growth.Credit Suisse also argues that Spanish housing prices are not sustainable as they are currently 7.2 times household earnings with many families spending between 60 – 70% of their income on mortgage repayments.
Mortgage Rates Reach a Record Low
Euribor, the interest rate normally used to calculate mortgage payments in Spain, fell from 2.1% in February to 1.909% in March 2009, a change of -10.6%. Euribor has never been this low, and is almost 60% below a year ago. This means anyone looking to buy a new property should enjoy lower interest rates and for buy to let investors this means more potential profits. Anyone with a mortgage or looking to get one should be aware that not all mortgages track Euribor with monthly changes. Some policies rate changes are reflected every 6 months or even yearly which means the benefits of a falling Euribor may not be felt for some time.
Property Prices in Duquesa, Manilva
Barrington Homes, Duquesa Estate Agents, have witnessed a dramatic fall in property prices of between 30 – 40% depending on the location and type of property over the last 9 months. The dramatic drop in the property prices are generally due to the economic downturn with vendors unable to pay mortgages on second properties and also vendors looking to return to the UK due to the fall in the pound.
For example 2 bedroom apartments are now available from 125,000€ compared with a price of 220,000€ 12 months ago. Barrington Homes have 3 bedroom townhouses priced from 143,500€ compared with an asking price of 235,000€ 12 months ago. Villa prices are also seeing dramatic falls with private villas with pools available from 375,000€.With bank and government combined efforts to boost the economy the property downturn is predicted to last for only another 12 months. After this investors should see a slow yet steady climb to near previous highs within 5 to 7 years making buying property in Duquesa a very attractive proposition indeed.
Barrington Homes have discounted apartment in selected developments with yearly rental returns of between 4 – 6% with compared to current bank interest rates is very attractive. Apply for an Investor Pack by emailing info@barringtonhomes.eu
Clearly for the shrewd investor there are potential profits of thousands to be made. However with bank lending criteria becoming increasingly tighter these opportunities are only available to those who can afford a high percentage capital outlay or who have a high income to borrowing ratio. If you are unsure if you meet this criteria then contact a sales advisor on 0034 952 936 216 or email info@barringtonhomes.eu
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