Many of the current property searchers are cash buyers, or only require a small mortgage and are primarily looking at holiday homes mainly with the idea of using them during the holiday months, if they have children, or in low season if they have no children living with them.

As an interesting change many appear to have previously lived or rented long term within Fuengirola and know clearly what they are searching for.

Of course many are still looking for what they see as bargains, so are understandably looking for the best offer possible. But of these property hunters have healthy budgets and unlike last year, vendors are more open to listening to offers.

According to TINSA, a respected property valuation company, prices along the Mediterranean coast (Costa Blanca, Costa Tropical, Costa del Sol, etc…) are from July 2007 to July 2009, down 16.5%. But to clarify, this does not reflect current prices, simply the value that TINSA has given to the average square metre built. Current asking prices by owners are generally down but the figure varies greatly due to location, qualities, etc…

As a rule of thumb many estate agencies are quoting that prices are down anything from 20 to 50% down on asking prices. But again these are meaningless figures as in the past many agencies would quote a high sales price for a property simply to get the listing, or simply let the owner set the asking price. In both cases this simply helped flood the market with overpriced properties.

As it stands now, although prices in Fuengirola have held up reasonably well compared to many other areas, the average price per square metre in Fuengirola now stands at 2,250 euros per built square metre. But please note this is an average figure with higher quality, garage, pool, etc… raising the price.

The reason why Fuengirola has felt the property crisis to a lesser degree than certain other areas is due to the following. First it bypassed a lot of the property invest craze as there were fewer newly built properties and due to the fact that it is a well connected town with both road and rail lines leading out of the town. Although not a large town, with 8 kilometres worth of beaches, being quite flat as opposed to being on a slope as many areas/towns are and half-way between Marbella and Malaga, Fuengirola makes an excellent base for many tourist looking at a home. It is also very popular amongst the Spanish, who although speculated as much as the next person, were more in tune with average prices, etc… than many foreign buyers. The also chose to buy in towns as opposed to urbanisations in less accessible areas.

Regards
Andrew Belles

Now if the Junta is so anxious to convert them, why has this not happened? Well you see, as soon as a property gets VPO status it has to be sold at a considerably reduced price. And surprise, surprise the developers are causing a fuss.

According to the Association of Builders and Developers of Malaga many of the properties being built in Malaga are “houses with a very big open-plan sitting room and kitchen, suitable for a holiday home but not conforming to the rigid standards for subsidised housing”.

It appears that under the currently regulations (despite having been relaxed) many of these properties would be left out of the scheme due to the size of the bedroom and kitchens.

The other issue is pricing. At the highest price a VPO can be sold for 178.000€. This would be sold to people with incomes up to 3.000€. Guess which price bracket the developers would want their VPOs to be sold in?

The confusing issue about this is if it were simply a matter of reducing prices, it would be assumed that the developers would simply drop the price to get rid of excessive stock. But the problem at the moment for many is a lack of credit, which according to the developers is real problem and the reason why they are not converting the properties into VPOS.

But the housing department has existing agreements between themselves and savings banks to guarantee the loans for the purchase of VPOs. If this is the case, it comes down to greed. It appears that the developers are hoping to ride the credit crisis and be able to sell existing prices and make their expected profits. Unfortunately for them, many will probably not be able to survive the crisis without converting these properties. This is foolish. If these projects were completed now, it would allow the developers to re-invest the monies in further projects. In fact as part of Spain’s stimulus package is the creation of more subsidised housing. But only time will tell what they will do. For our part, a construction project we are involved in was converted to VPO status while applying for planning permission, due to the declining ‘off-plan’ market and the existing demand for cheaper properties.

Regards
Andrew Bellés

It is a residential/recreational area located between Marbella and Fuengirola.

La Cala is recognised by the Royal Spanish Golf Federation as the largest golf complex in the country. It has 60 holes of golf.

The resort also includes a luxury hotel, clubhouse, a David Leadbetter Golf Academy (the only one in the Spain), a Taylor Made Performance Lab and three 18-hole golf courses.

The complex has held many important competitions including the Ladies European Tour and the Spanish Pairs final. It also held in 2008 the single largest event of the Ivobank EuroPro Tour.

But this resort is also known for its football grounds. During 2008 and 2009 the resort has/will be used as the training base for multiple clubs including Sunderland AFC, Reading FC and Peterborough United, Sevilla Atlético, Dynamo Moscow, Borussia Monchengladbach to name but a few.

La Cala Resort is also a Guinness World Record holder for having the largest number of golfers play in any one day event. A total of 614 entered and played in the competition.

Having such a prestigious facility has helped enhance the value of properties in the area and has subsequently helped spur development in the area which includes the future train terminals linking Malaga to Marbella and plans for the creation of a Marina in La Cala.

Regards
Andrew Bellés