Costa del Sol property blog

As you can imagine in recent months we have been approached regarding repossessed apartments, townhouses and villas throughout the Costa del Sol. Where can they be found, whether we had any, etc…

There have recently been a few companies that have attempted to market reposessed properties through auctions and web advertising and most have failed miserably. How can this be? Would not the canny investor with hard cash be willing to grab a front line beach apartment for 50,000 Euros anywhere on the Costa del Sol? Of course, such property just does not exist!

People talk about auctions or repossessions and the huge discounts available, but if you look at the figures, the figures just don’t stack up. Please don’t take my word on it, do a search on Google. You will either come up with one of two types of websites when searching for bank repossessions on the Costa del Sol. The first type, will be a site stuffed with terms like bargain, distressed, etc… and will not contain any properties but ask you for contact details. The second type, will show you some properties that might be from the banks but the prices are not particularly impressive.

So why are bank repossessions not necessarily that fantastic? Well unlike say the UK, banks in Spain take a more long term view to property. Although repossessions are higher now than this time last year home-owner mortgages do not make a majority of the debt owed to banks. This is due to the banking legislation put into place by Spain’s central bank; Spanish banks have to way up the risks of giving mortgages a lot more aggressively than their counter-parts abroad. Second, if the last crisis is anything to go by, the bank would rather sit on the asset and wait until a turnaround in the market. Many will more than likely set up management companies to deal with the stock, renting them in the meantime and selling them when the market turns around.

Many of the most desirable apartments, townhouses and villas were bought by a select few, who generally bought off the successful sale of a previous asset they had. A standard example is the British couple who sold their semi-detached back home for an astronomical sum and then used the proceeds to buy their ideal home on the Costa del Sol.

The other sort of buyer were those who bought into the marketing/dream and went for the off-plan purchase, putting down 15%/30% with the remainder on completion. Now that they can’t complete the property has been reclaimed by the developer, who, already discounting unsold properties, can do it further on that particular unit due to the gains made on the fallen through sale. And few of the developments are in prime locations, so even with heavy discounts, are not the most attractive of propositions.

A good example is an apartment block in Los Pacos of Fuengirola. On one repossession site a ground floor apartment there is advertised for 199,000 Euros. Whereas we have 2 properties there can beat that price and are tastefully furnished.
Los Pacos apartment at 179,000 Euros
Los Pacos apartment at 197,000 Euros

So whatever you are looking for, don’t get caught up in marketing gimmicks. Keep track of prices and when you are a position to buy on the Costa del Sol send through you enquiries to view the properties. Then put through what you see is a reasonable offer on the property that you feel best suits your criteria.

Regards
Andrew Belles