05:20 PM · Comments Off on One in every 10 mortgages owes more than the price of the property · Categories: News from Marbella Costa del Sol

Falling housing prices, unemployment, economic contraction and tightening the conditions for access to credit have led to nearly 10 % of Spaniards mortgaged drag a mortgage bubble, ie a the mortgage is worth more than the price of your home.

In particular the number of mortgages that are worth more than the property has soared, going from 14,333 homes affected back in 2009 to 581,441 in 2013, according to the website kelisto.es recent comparison.

The company expects that this year the number of such mortgages increased to 668.940.

Currently one in every 10 property owners mortgaged in Spain is trapped in a house that is worth less than the loan that is payable ( 9.5%), a rate that will rise to 10.7% in 2014 and 11,3% by 2015. This means that the hole or gap between mortgage debt and house price is 22,216 euros on average per household, resulting in a total of 12,917.5 million euros according to kelisto.es, This figure will increase by 29.5 % in 2014 (up to 16722.15 million) and 17% in 2015 ( 19579.7 million).


housing bubble


The reasons behind this negative situation are unemployment, the economic downturn, the mortgage closing faucet and falling house prices. kelisto.es ensures that housing prices fell 38.5% from their highs in 2007 and could be estimated to drop 8.5% in 2014 and 8% in 2015, although some of the bigger banks think that the market has bottomed out and prices may start to rise this year.

The autonomous communities, Catalonia and Madrid are accumulating a greater number of homes with the “mortgage bubble”, 42.5% of the total (247,489), specifically 24.4% (142 008) was in Catalonia where they could reach 155,347 in 2015, the remaining 18.1% (105 481) was in Madrid, where that could possibly reach 116,208 in 2015.


housing bubble


For the preparation of the report kelisto.es utilised the value of the mortgages at the regional level that facilitates the national statistical institute (ine) and Spains bank data on the relationship between the value of the property and the mortgage amount owed (loan to value). Future projections are based on the pricing model of the center housing of economics and business research (Zebra) for Spain, which includes projections on mortgage lending, housing supply, GDP and employment trends.

The study focuses on mortgages approved at loan to value ratio above 80%, when the value of the outstanding mortgage exceeds the value of the house these mortgages are defined as a “housing bubble”.

12:29 PM · Comments Off on Malaga and Marbella more companies were created in 2013 · Categories: News from Marbella Costa del Sol · Tags: , , ,

Malaga Ranks fifth nationally in the creation of new businesses and has the most dynamic trade sectors in property development and services.

A total of 4,386 companies were created during 2013 in Malaga, making the province the fifth fastest most growing province last year.

These figures represent an increase of 14.85 percent over 2012, according to official data collected by Infocif, the social network created by Gedesco that includes all the information on entrepreneurship. According to this study through a statement by Gedesco, more than 467 businesses were created in 2012, when 3,819 new companies emerged.

More business start ups will help lift the economy

More business start ups will help lift the economy

The most dynamic sectors were trade, real estate and food service locations and drinks. Marbella was where most companies were created in 2013 , with 224 new businesses ahead of Malaga, where 145 companies were founded, then came Fuengirola 52, Benalmádena with 45, and Torremolinos with 30. Málaga was the fifth Spanish province where more companies were created, behind Madrid, Barcelona, Valencia and Alicante.

In the Spanish capital Madrid there was an increase of 12.5 percent compared to 2012, in Barcelona it was 14.73 percent, with over 13,593 companies, in Valencia 4.32 percent, 4,560 companies more, and in Alicante, 6 percent, more than 4,450. According to Gedesco during the past year there were  86,144  companies created nationwide, 9.27 percent more than in 2012, in which 78,853 companies were founded.

11:59 AM · Comments Off on Costa del Sol A7 Marbella coast road to be improved starting this year · Categories: News from Marbella Costa del Sol · Tags: , , , ,

The mayor of Marbella Ángeles Muñoz has said she is ” very satisfied ” with her meeting Wednesday in Madrid, along with other institutional officials in the province and with the Minister of Development, Ana Pastor.

From the meeting she stressed that improving access to the A -7 in the area of Las Chapas will begin before the end of this year with the first phase in Rio Real, Marbella, a very dangerous part of the A-7 or the old N340 as it was known before, a accident hotspot.


Rio Real in Marbella will be the first place to be improved on the very dangerous A7 coast road

The councillor has especially emphasized that there is already a budget of two million euros planned for this year, there is expected to be a bid for the works in early summer and work will begin around the end of 2014.

Muñoz said, ” The work will be carried out in phases and the first will be in Rio Real ” who added that “everything is moving forward.” She also recalled that the study is ongoing for the viability of the rail link to Malaga .

02:06 PM · Comments Off on Unemployment falls in Spain · Categories: News from Marbella Costa del Sol · Tags: , , ,

The total number of unemployed fell in the fourth quarter in Spain from October to December by 8,400 people in the previous quarter to stand at 5,896,300 people, this data which changed the unemployment rate at 26.03% of the active population according to a report by the National Institute of Statistics ( INE ). In 2013 the total number of unemployed people fell by 69,000  to 5,896,300 – (expansion.com)

This is the lowest drop registered for the first time since the second quarter of 2007

The increase in the annual rate of unemployment in 2013 up to 26.03% ( 26.02% in 2012), has been reduced by 267,900 people in the labour force during the year, reaching 22.65 million, a figure that makes up for the drop in unemployment.

In terms of job losses in the last quarter of the year, employment fell by 65,000 to a total of 16,758,200 breaking a streak of two consecutive quarters of job creation.

Unemployment down

Unemployment down

Compared with the previous quarter the biggest declines in unemployment occurred in the Canary Islands ( 21,600 fewer people), Catalonia ( 20,100) and the Principality of Asturias ( 11,400 ), while the largest increases have occurred in the community of Madrid ( 37,400 more unemployed ), Balearic Islands ( 29,100 ) and Castile and Leon ( 9000 more).

This quarter occupancy decreased by 30,200 persons in private employment and 34,800 in public employment while over the whole year the reduction was 121,400 people and 77,500 public workers and private workers.

By sector in the last 12 months alone employment was created in agriculture ( 85,200 jobs ), while services fell sharply ( 109,100 ), construction fell ( 35,200 ) and so did manufacturing by ( 6,000).


11:54 AM · Comments Off on New and resale home sales in Spain since 2004 · Categories: News from Marbella Costa del Sol

Back in 2004 nearly 400,000 new homes were sold in Spain and about 550,000 resale properties, ie more than 900,000 homes. This compares with less than 300,000 units sold in 2013.Here we show two tables developed by the appraiser Euroval evolution who have collected information of sales by regions.

There are communities in the first nine months of 2013 where new construction transactions fell more than 60% than over the same period of 2012, including the areas Cantabria, Castilla La Mancha and Extremadura.


The sale of resale housing helps generate tax revenue and the movement in the resale market is positive because it helps to stabilize prices, which is a stimulus for the housing market.

Recent developments in the transaction activity is positive, almost 5% of the national average and significant increases in the towns  of Rioja, Catalonia, Valencia and the Canary Islands.

However no significant increases were recorded in Andalusia and Madrid, and less in Cantabria, the Balearic Islands  remained the same and there were negative rates in the remaining seven regions.

The two graphs shown below give the number of housing transactions per year.

New and resale home sales in Spain since 2004

venta-viviendas-usadas-provincias-euroval-2013 (1)

01:12 PM · Comments Off on Banco Sabadell says housing market in Spain has bottomed out · Categories: News from Marbella Costa del Sol · Tags: , ,

Banco Sabadell has sold 16,000 properties during 2013 at a total of €3,000 million, compared to 13,777 sold in the previous year amounting to €2,316 million. The target for 2013 was to sell assets of 16,000 properties, 17% more than in 2012 which amounted to €2,600 million an improvement of (+16%), Josep Oliu the banks president says the price of housing “has now bottomed out”, “when you really start to move the real estate backlog it is the beginning of more movement in the economy”, said Oliu, but he has clarified that the housing stock will take years to be sold depending on the economic outlook of the market.

Josep Oliu president of Banco Sabadell (Photo:Idealista.com)

Josep Oliu president of Banco Sabadell (Photo:Idealista.com)

Oliu estimates the stock of bank Sabadell real estate assets totaled 18,000 million euros, and the company will invest 150 million euros in the construction of 1,182 homes in areas where Spain has detected a spike in demand or prices.

01:28 PM · Comments Off on Property investment against the stock market · Categories: News from Marbella Costa del Sol · Tags: , , ,

Over recent years bricks and mortar have been a favourite investment for the Spaniards, the thesis that the price of housing never goes down encouraged many to buy a flat with the intention of selling in the short term to achieve major gains, however, as by noted John Serrano the author of calm investor, a home that is not used is a bad investment and further believes that investing in a home costs more than to invest in the stock market.

The author challenges the myth of bricks and mortar as an investment with these eight arguments:

1. Housing is a valuable asset but a house that is not used is a bad investment,  “You have to paint it , fix it, maintain it, pay for electricity , water and taxes, if we estimate that the annual maintenance cost is 1% of its value, in a hundred years we will have spent on maintaining the property an amount equal to what it cost us.

2. Rented accommodation has been as profitable as shares in the last 100 years and should have earned an annual return of 6.08%, which is the actual appreciation rate of Dow Jones stocks in wall street in the last 100 years, allowing for dividends and adjusted for inflation.

3 . It is not true that house prices do not go down

4 . All investors can buy shares but it is not possible for everyone to purchase property, ” it makes no sense that I have three houses to rent and you have three more to rent to me “.

5 . The cost of investing in housing leads many to invest in the stock market, when buying property you pay a 7% transfer tax, on top of that you pay 1% and 3% in registration fees and notary costs. In total the cost ranges between 8% and 10% of the home value but the fees and expenses to buy shares ranges between 0.2% and 0.5%.

6. To buy a good house you need a lot of money, for this reason many people invest in low-quality housing in unattractive areas, which in the long term ends up not being profitable.

7. No housing investment tends not to diversify the majority of investors, they tend to put all their savings in a single investment.

8. To manage a portfolio of stocks is easier than to manage real estate, Serrano points out that buying or selling a home is more complicated and takes longer to do.

property investment spain

Property is a long term investment, shares are more short term

12:55 PM · Comments Off on The price of housing in Spain is overestimated by 10% · Categories: News from Marbella Costa del Sol

The price of housing in Spain is overestimated by 10% by the end of 2013 with respect to household disposable wages, according to the British weekly “The Economist”.

Spain leads with Italy ranking highest in the falling prices of most developed countries in the world, by index housing has fallen 5.3% in the last year and accumulated a 30% decline from the highs recorded in the first quarter of 2008. In Italy homes fell 5.9 % last year and 12.2 % from highs, and there are estimates that housing prices could drop another 10%.
When calculating the over-valuation of housing, the economist analyses data from long-term monthly rent and salaries. According to this classification, Hong Kong, New Zealand, Australia, Britain, Canada and Belgium would be among the countries with the most overvalued housing.

The evolution of housing prices in recent years

The housing price graph of the economist shows how Spain still remains the country where prices have risen more long term and despite the recent falls in the price of real estate, property in real terms would have increased by almost 30 times since 1975, when looking at the short term for example  from 2006 shows how Spain is no longer the country with the largest increase in the world price.

evolution of housing prices since 1975 in different countries

Evolution of housing prices since 1975 in different countries

11:15 AM · Comments Off on Spain leads fall in new housing prices · Categories: News from Marbella Costa del Sol · Tags: , , ,

Although the price of housing in Spain has reduced its rate of decline, the fact is that Spain continues to lead the global slump, according to the global property guide the value of homes in Spain fell 9.46 % in the third quarter of 2013 compared to the same period last year. This figure is the largest decline in major real estate markets in the world.

Spain wins gold again by having the sharpest drop in housing prices worldwide, specifically country houses depreciated 9.46% between July and September last year compared with the same period in 2012.

According to figures from the global property guide specializing in the analysis of real estate portals worldwide web, Spain is again the country where the housing market showed the worse performance, ahead of others like Greece ( -8.85 %), Russia ( -8.18 %) and Romania ( -7.15 %).

Even countries that have suffered catastrophes show a significant change in trend, this is the example of Ireland where house prices rose 3.45% in the third quarter of 2013.

In particular if one looks at the rate of federal management agency housing ( FHA ) the price of U.S. houses rose by 6.72 % over that period, while the S&P/Case-Shiller home price Indices showed a rise of 9.43%.

Dubai is leading in price rises

Dubai ‘s residential market is the opposite of the Spanish, here the housing prices climbed 21.37 % between June and September last, year on year. The Dubai government has announced it is studying measures to curb property speculation and prevent it from another property bubble occurring again.

In general terms the housing sector worldwide is moving at very different speeds, although house prices rose in the third quarter of 2013 in 28 of the 41 countries surveyed by the global property guide, for many of them the value of the property is already moving in levels seen back in 2006-2007

On the other hand it was recorded that the 32 best-performing housing markets were between July and September last year over the same period of 2012 and only nine worsened.


Figures supplied by the Global Property Guide (c)

07:33 PM · Comments Off on La Bajadilla port Marbella – prince Al Thani fails to reply to demands from the Junta de Andalucia · Categories: News from Marbella Costa del Sol · Tags: , ,

The saga continues of the delayed port plans as Qatari Sheikh Abdullah Bin Nasir Al Thani has once more failed to reply to the demands from the Junta de Andalucia regarding the building of La Bajadilla Port in Marbella.

Back in August 2013, he paid out the €1.8 million required from the Junta de Andalucia for the managing costs for the port for 2012 and 2013, even back then this amount ought to have been paid sooner.

Nevertheless, this time around, his own staff have apparently failed to establish the development project required by the Public Ports Agency, that is part of the Junta de Andalucia Council for Public Works. This would have defined the primary completion dates for some of the most crucial phases of the development.

The Sheikhs organization, Bin Nasir Abdullah & Sons, as well as Marbella City Hall have already been advised that administrative procedures are going to be launched against them which may result in a fine as the town hall also owns a small percentage of the project.The fine could be appealed in opposition to, however the construction process has already been delayed by 17 months.


The project has already been delayed by 17 months