Many property deals have fallen through due to differences in opinion by the professional property valuers and their appearing to be ‘out of touch’ with the market. Banks’ valuers in Spain, Tasadores, are obliged to work according to the regulations of the Bank of Spain, which regulations at times have appeared to be more designed to influence the market for the benefit of the political requirements of the economy rather than following the market. The same has occurred in other countries Europe-wide and in other situations. With the countries of Europe trading increasingly between themselves, both in property occupation and investment terms, there needs to be a common, trusted standard. Continue reading
Prices on the Costa del Sol are still drifting down, except for special properties in the best locations. There is still demand and indeed competition for those, which maintain their value. Parallel to this, the banks are under increasing pressure to revalue their stock to realistic levels and to get rid of their property mountain. My opinion is that, unfortunately, they can only do that in bulk by offering prices that are sufficiently adjusted downwards to interest investors/speculators who hope to sell-off the properties as individual units. There are just not enough individuals around wanting to occupy. The original property bubble was inflated by speculation and it’s going to have to be saved by that too. However, the speculators are going to need deep pockets and to wait before getting any return.
Having said that, I do have a client who has bought two whole urbanisations and is selling to Nordic clients, where the economies have not suffered as much and there isn’t so much personal debt. Prices are not cheap, but he is making sure that his buyers are getting quality and above-average services. However, this is a numerically limited market. Russians, Germans and some other Northern Europeans, including the occasional Brit, are the other buyers, along with some Spaniards who have somehow kept or gained sufficient finance for investment. On the larger scale developments there is Arab money being invested for the longer term, so the future of the Costa del Sol is secure and will continue to mature. Continue reading
Anyone who either owns or is planning to buy property in Spain needs to know about the Catastral value of the property (or Cadastre to use the French term). Unlike the Land Registry, which records legal ownership and with which it is often confused, the Catastral is not a legal record of ownership, but is an estimate of the capital value of the property, which is used as a base figure for a number of property taxes. The easiest way to find the Catastral Value of a property is to check the amount listed on the IBI (local property tax) invoice or to visit the Catastral office in the town hall. However, note that the value should only be given to someone who can show a registered interest in the ownership of the property or their representative, which can make comparison with your neighbour’s difficult. Continue reading
A property has a generic value that most people will guess at, an experienced real estate agent will estimate and a trained professional – in this case a chartered surveyor – will be able to calculate more accurately without being influenced by the possibility of a selling fee or the emotion associated with property ownership.
There are tried and tested methods used by property professions to value every kind of property from retail units and warehousing to factories, office complexes and recreational facilities – not to mention homes ranging from the smallest studio to the largest mansion. Continue reading
Homeowners, mixing emotion and ego (and sometime desperation) plus the money they have spent on it, into the equation, will famously tend to overvalue their property. An agent may go along with this to get the listing, but reality strikes when the buyers list what can be bought elsewhere and the bank won’t give a big enough mortgage at that price. Continue reading
Sometimes the easiest way to explain the exact function of a Chartered Surveyor is to describe the variety of surveys on which their expertise is considered vital. As you will be able to see, their knowledge can be requested by a number of different parties, depending on the situation.
The following four categories will typically occupy the majority of the surveyor’s working week.
These are carried out on behalf of a bank or other mortgage lender. These surveys, though paid for by the borrower, are really for the benefit of the lender, since they are undertaken to ensure that the lender’s money is safe. A mortgage survey in Spain, unless it is carried out on behalf of a UK or Gibraltarian bank, has to be carried out by a tasador acting on behalf of one of the Sociedades de Tasación approved by the Bank of Spain. These companies have to place a substantial ‘bond’ with the Central Bank, which would appear to be a kind of indemnity fund where lenders can be compensated in case of gross error by the tasadores. This central control can lead to the Sociedades being used to influence the market, such as the recent example where they appeared to have received instructions to undervalue in an attempt to reduce mortgage lending and slow the rise in values. So their valuations deliberately may not accurately reflect the price that the property could command on the market. Continue reading