The truth about buying in Spain

pic13JANE SLADE assesses the property market in Spain and discovers it is not all doom and gloom but you do have to watch where you buy The Hondon valley, a hilly, rural enclave of villages and farms 40 miles inland from Alicante has been a peaceful idyll for many Brits who came seeking a place in sunny Spain away from the searing heat and concreted Costas. But since the recession many hit by the poor Euro exchange rate have been forced to sell their villas at rock bottom prices or hand the keys back to the bank.

“Marbella is at its peak right now” Despite what we hear about Spain’s dire financial situation, high unemployment figures and landscape littered with unsold homes you would be hard pressed to find a downbeat estate agent. In fact in some areas they are positively cheerful. Michael Lovett, director of Fine & Country Marbella says: “Marbella is at its peak right now not just because of the unfortunate weather in the UK but because the area is undergoing a real rejuvenation.

 

Changes to the cultural scene and the transport system have recently been made to re-establish Marbella as the place to live and as a result, the future of the property market is promising.” Number one buyers are Russians and Scandinavians Astonishing perhaps but Spain is still the number one destination for Brits; although according to British builder Taylor Wimpey Espana, their number one buyers are now Russians and Scandinavians. “On the Costa del Sol alone, 45 per cent of the total sales this year have been from both Scandinavian and Russian buyers,” says Marc Pritchard, Taylor Wimpey’s sales and marketing manager. The developer is selling two-bedroom apartments and three-bed penthouses on its La Floresta de la Mairena scheme near Marbella, priced from €178,000. And at Avalon, also in Marbella near the Los Arqueros golf course, it is offering two and three-bed apartments boasting sea and golf views from €250,000.

 

British estate agent Mercers are also very positive about the property market in Murcia. “Prices seem to be holding steady,” said Chris Mercer, who has 29 year experience of selling freehold Spanish properties and sells mainly to retirees aged between 47 and 65. “The average age of our buyer is around 60 and spends between €110,000-€200,000,” he says. “They’re not just coming to buy a bargain; they want a good property they can enjoy. I boldly expect our sales to increase by 25 per cent in 2013 over 2012.”

 

Problems for those seeking mortgages

He adds that houses priced at €195,000 are now selling for around €185,000 however he does anticipate problems for those seeking mortgages.

 

“The main issue is that bank funding will continue to be a problem in Spain. If a buyer wants more than 50 per cent loan to value and the property is not bank owned, it really is a no-go situation. This will limit the market to wealthier cash-rich buyers and steer people in the direction of, often less desirable, repossessed homes.” Nothing deterred Peter and Jennifer Siggers, both 62 (pictured left) from selling up and buying a three-bed, three bath villa with private pool in Camposol, Mazarron for just €155,000 which they discovered on Mercers’ website. “It was impossible to match euro-for-euro elsewhere on the Spanish Costas or islands,” says Peter, a former manager of a timber merchant in Nuneaton, Warwickshire. “We’re not overlooked, have views to the hills and the countryside, yet can reach the social bustle of the on-site restaurants, bars and shops on foot or via a quick car journey.”

 

Interestingly Spain’s infrastructure does not seem to have suffered since the downturn. Daniel Chavarria Waschke, who heads up Balearics Sotheby’s International Realty which has offices in Mallorca and Ibiza, reports that the airport in Mallorca has been expanded and upgraded and that there are numerous private hospitals and medical specialists operating to very high standards.

 

Sothebys are positioning themselves to target the high net-worth buyer

“Health care equals or exceeds standards found in northern Europe,” he says. “And two years ago new roads were delivered across Mallorca. We understand there are far more potholes in England.” Such is the confidence of Sothebys that they are positioning themselves to target the high net-worth buyer. “We have adjusted our real estate portfolio to exclusively market only houses with a sale price exceeding €2 million and apartments of over €500,000 to suit our target market,” Daniel boasts.

 

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“We discovered Hondon quite by accident,” explains Diana. “We just stumbled across the valley after driving over the mountains and fell in love with it. It was peaceful, and unspoilt.” They bought their three-bed, two bath villa with pool from a builder along with a neighbouring plot of land to secure their privacy.

 

It is just 40 minutes from the beach, in secluded spot, close to the village and built from natural stone and sits on a large plot of land. However its €295,000 price tag has attracted few buyers. Now Bruce has decided to reduce it to just €199,000.

 

Diane, 76, a retired company secretary and Bruce, 75, a former record producer, have decided to sell because of Bruce’s ill health. He had a triple by-pass last year. Fortunately they have retained a home back in the UK on the Sussex coast.

 

“Our house would be perfect for a couple who wanted to run a business,” says Diana who is also prepared to include several pieces of furniture in the sale. “There is plenty of space for a workshop or office. I had thought of running a kennels.”

 

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The spacious, single storey house stands in one-acre bordering an Almond farm and vineyard with views of the valley and mountains. It has a mature garden of fig and olive trees and oleander bushes surrounding a large swimming pool.

 

This mountainous region has proved particular popular with downsizers and retirees as the climate is cooler which makes it more tolerable in summer. The Hondon valley is still a relatively undiscovered secret, within easy access of Alicante. The mountain trails are popular with hikers and the historic town of Aspe with its cafes and restaurants is half an hour away. You are also four hours from Madrid and three hours from Granada and the stunning Alhambra Palace, both of which makes for easy weekend cultural breaks

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Tips for retirees thinking of moving to Spain

• Choose an area where you will meet like-minded people. Buying a remote finca or farmhouse may sound like a rural idyll but the reality is that you could be lonely and cut off.

• Choose an area close to good medical facilities but take out private health insurance if you can afford it.

 

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• Acquaint yourself with the local culture. For example the nursing care in hospital is provided mostly by patients’ families who bring in food and clothes. Will you have friends or family to do that for you should you need it?

 

• Buy in an area where there are social groups you can join and things for you to do. You don’t want to be bored.

 

• Be prepared for lots of visitors; you will be surprised how many friends and family will treat you and your home as a free holiday.

 

• Learn the language; you will appreciate the country and its traditions, cuisine and culture so much more – unless you have just come for the sangria and sunshine.

 

• Things happen at a different pace in Spain so be patient. Be prepared to go with the flow, slow down and take two hours over lunch. A plumber may turn up when booked but more than likely it will be three hours later or even the next day!

 

For more information on the Bastin’s villa in Hondon email: interstatemusic@btconnect.com

To contact Sotheby’s International Realty in the Balearics visit www.ibiza-sothebysrealty.com or www.mallorca-sothebysrealty.com

 

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To view property for sale on the Costa Calida in Murcia, such as the villa pictured left on Camposol Golf, visit Mercers at www.spanishproperty.co.uk

 

To see Taylor Wimpey Espana developments visit www.taylorwimpeyspain.com