Housematix » property

The fibs that property vendors tell, in Spain at least

Mark Stucklin — Wed, 10 Feb 2010 19:31:02 +0000

Vendors always went to highlight benefits whilst reducing perceived costs, but telling porky pies is another matter. In a country like Spain, where the information you get from estate agents is patchy at best, buyers often find that the property or plot size ain’t half as big as advertised. Here is a list of some other common fibs told by vendors.

There is no damp or infestations
The electrical installations are in perfect condition
This place never gets flooded
Taxes and maintenance costs are low
It’s a quiet area
They are going to build a golf course here
Your sea view is safe

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Solid Report for Trump Project in Panama

Kevin Brass — Mon, 07 Sep 2009 14:44:18 +0000

The Trump Ocean Club, the bellwether project under construction on the bay in Panama City, is still hitting its financial and construction targets, the developers told bondholders last week. Newland International Properties sold 23 units in the first half of the year, bringing the total sold to 832 of the 1,004 condominium and hotel units, according to the report, which can be found on the Panama Investor Blog.

While there have been accounts of steep discounts and stagnant sales in other Panama City towers, the Trump project is discounting units an average of only about 13 percent, Newland told investors. The average price for a two-bedroom unit is about $683,000 or $4,452 per square meter.

Like many projects that carry the Trump name, Newland is simply licensing The Donald’s brand. Widely believed to be the most expensive of the many new towers sprouting in Panama City, the Trump Ocean Club’s progress has been closely watched, amid concern the Panama City market is over heated.

Last year the Fitch Ratings service downgraded the project, due to “the significant deterioration in global real estate markets and an increase in liquidity risks associated with the timely payment of principal and interest on the notes.” Some analysts feared that some buyers would simply walk away from their deposits, but Newland reported only eight defaults. (Buyers are required to pay 30 percent during construction and 70 percent upon completion.)

The tower remains on schedule to open in August 2010, the developers say.

Dubai Faces Sea of Empty Units

Kevin Brass — Fri, 14 Aug 2009 14:41:19 +0000

Somehow this is not a big surprise: Dubai, the poster child for the boom years, is facing a surplus of 31,000 homes by the end of the year, according to a new JP Morgan report.

You don’t need a fancy economic degree to figure out the reasons for the sea of empty homes. “Modest economic forecast and negative population growth estimates” are blamed for the surplus. In other words, the flow of overseas buyers has dried up for all those new, ground-breaking, one-of-a-kind developments.

If anything, the 31,000 number sounds light, considering the drop in demand. And that means, if Dubai is a true open market, prices should continue to fall, as well.

The latest report from Colliers International (available here) found prices dropped 48 percent from the second quarter of 2008.

Nobody is buying holiday homes on the Costa Blanca anymore

Mark Stucklin — Tue, 07 Apr 2009 11:37:43 +0000

Is this what you really want?

I read that holiday homes on the Costa Blanca aren’t selling so well these days, down 83% in 2 years, from 4,233 sales in 2006 to just 702 last year (sales by developers to non-resident Europeans).

Seems that the Costa Blanca is suffering the consequences of relying too heavily on British buyers, at least that’s what the article I read said. It’s also suffering the inevitable consequences of building lots of crap and trying to sell it for ridiculous prices, whilst trashing its coastline in the process.

Of course the weak Pound isn’t helping. Britons used to pay around 90,000 Pounds for a property costing 150,000 Euros in Spain. Now they have to pay around 136,000 pounds for the same thing.

Mea Culpa?

Seems that local developers are finally trying a bit of ever-so-light mea culpa, which us unusual for them. Ramón Jerez, President of Business and Construction Federation (Fecia), hinted to the local press that there might have been a touch of over-development in some areas. He says it must stop. It’s a bit late mate, and anyway, the market collapse has stopped it for now (it will happen again one day).

Jerez also suggests that developers should try asking their potential buyers around Europe what they want before starting to build. Radical stuff. Market research has been standard procedure in most industries for half a century, but Spanish developers are just waking up to it. You can tell they never used it before – just look what they did to their coast.