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Brits returning to the Spanish property market

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Once upon a time, in a nearby land, we British fell in love – with Spain and her glorious sunshine, her fine clear air and her seaside towns, her country vistas and her fine wines and fresh food. Buying a Spanish property was the best way to experience the Spanish way of life, so thousands of us took the plunge and it was good.   The End.

Well, not the end at all – for while the Spanish property market did suffer a few turbulent years and we temporarily deserted our love, it seems that British buyers are now very determined to re-kindle their Spanish love affair.

We are reliably informed that Spain accounted for approximately 4O% of enquiries received by overseas mortgage specialist company Conti in May alone, overtaking those from France for the first time in over a year. Conti believes that with banks such as UBS predicting another 8% or so fall in Spanish property prices before reaching bottom, buyers have now got a wonderful chance of snapping up some real bargains from some very receptive vendors. When we add the advantages of cheap, simple access from the UK, great rental opportunities and of course abundant sunshine, we can see no downside. Looking at data from the General Council of Notaries, we see that the number of foreign & non-resident buyers of Spanish property increased by 28.4% last year and the British are the biggest buying group. Strenuous efforts being made by estate agents and tourism boards across the country to improve Spain’s tainted image will hopefully bring back much needed foreign investment. This will help to revitalise the Spanish property market, further boosted by a new law granting automatic residency to non-European Union nationals buying property worth at least €5OO,OOO.

Clare Nessling, a director at Conti, makes the following additional points:  ‘It’s no use denying that Spain’s economic woes have left a huge glut of new and re-possessed properties sitting empty and struggling to sell, but some bargain-basement prices are turning heads, particularly British heads, and there may never be a better time to buy a Spanish home. Unsurprisingly, mortgage availability is not as good as it was a few years ago but there are still lots of opportunities, especially if you have a healthy deposit to put down. It’s generally possible to borrow 65–7O% of the value of the  property and interest rates currently start from just 3.2%’ she explained, adding the essential need for buyers to seek the right advice and to go through the same rigorous process they would follow if purchasing in the UK.

Top Tips for buying in Spain

Make sure that you obtain an Approval in Principle. This will confirm that you have access to the necessary funds before you sign on any dotted lines and it will prove to the vendor that you are a serious buyer.

Don’t forget to take into account exchange-rate fluctuations. It is vital to ensure that an overseas mortgage and the income that is used to service the repayments are in the same currency, thus avoiding any complications.

If purchasing from a developer, it is recommended that you check both the company’s track record and the number of years they have been trading.

Where possible, you should obtain references from previous buyers, check any comparable properties in the area and note any re-sales being offered on the same development.

Finally, please bear in mind that lawyer’s fees, local and national taxes plus insurance etc. can often add a further 1O% to the final cost of your purchase, so it’s very much in your best interest to take independent advice from an English-speaking lawyer with no connection to the vendor, the estate agent or the property developer.

Last Word..........

With a red rose between your teeth, what could go wrong?  

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