Hesitant Market Fosters Excellent Opportunities

The price slowdown in Spain’s real estate sector has, understandably, created an attitude of hesitancy in the local Spanish property market. Spaniards have traditionally been known to strongly favor buying over renting, but with the apparent end of the property boom that saw continuous price rises for the last ten years, many fear a market collapse (which, despite having been loudly predicted by some, has still failed to materialize).

Many experts predict a manageable, gradual price landing instead of a full-blown crash – a viewpoint that so far is supported by price figures for 2007 – but Spaniards are still wary and many have opted to postpone purchasing a home until the future of property prices comes into focus. This tendency has been felt mostly in areas not popular among foreign property buyers, where prices have increased at low rates or experienced actual decreases.

The Spanish property market was heavily influenced last year by investment from abroad in areas popular as overseas property destinations (Murcia, Costa del Sol, Alicante…). If one excludes the impact these areas had on national property prices, it becomes evident that Spaniards themselves are buying less.

This has motivated estate agencies to offer incredible deals on home purchases in order to stimulate the market. What comes next may seem unbelievable, but it’s 100 percent, verifiably true:

Buy A House, Get A Free Car!

Buy 1 House, Get the Second House Half-Price!

These types of offers have been seen mostly in areas such as Galicia where investment from abroad hasn’t been very strong and the market is mostly supported by Spaniards. However, they are just as valid for foreigners and present the chance to take advantage of amazing and unheard-of deals that seem more appropriate for food products than entire properties.

For those with their eyes set on the beautiful green landscape and more quiet nature of northern Spain, these offers are a dream come true. Someone interested on buying a property in Galicia to relocate or retire in, for example, would only have to get in touch with another buyer interested in the same region to pair up and take advantage of the “Buy 1 House, Get the Second House Half-Price!” deal; in this case, both parties would come out of the deal with a house at three-quarters of the original sale price.

Lucrative offers such as these are not only taking place in areas unpopular as overseas property destinations, however. Unheard-of deals have also been seen in foreigner’s markets in Spain, such as the opportunity to get 100 percent financing on the purchase of a home. Previously, this was unheard of for foreigners, who at best could hope to secure between 60 and 80 percent financing on a home purchase.

If you’d like help locating and taking advantage of any of the offers mentioned above, please contact SpainREi for additional information.

Opportunities in Spain’s Vacation Rental Market

Since Spain overtook the US in the number of tourist arrivals in 2004, it’s been the world’s top tourist destination along with France, according to figures by the United Nations World Tourism Organization.

Nearly 60 million tourists visited Spain in 2007, and obtained thus far this year promise stronger numbers in years to come. A study by the information agency Thomson Financial shows that approximately 3.3 million people visited Spain last February; nearly 7% more than in February 2007.

These figures speak very favorably for the future of Spain’s vacation rental market, which has been in high demand at least since the inception of the Spanish property boom. Growing tourism in hotspots throughout the country continues to heighten demand of vacation rentals, increasing the value of rental properties and creating lucrative opportunities for property owners who place their homes on the vacation rental market.

Prospects in the Spanish vacation rental market are set to improve thanks to the re-election of President José Luis Rodriguez Zapatero, who has promised to work on improving conditions for property owners who intend on renting their properties. This will be accomplished by providing mortgages and improving legal protection for landlords.

British Airways Considers Iberia Takeover

Britain’s premier carrier has had its eye on Iberia at least since last year, when the company negotiated a failed takeover with Spanish bank Caja Madrid (Iberia’s major shareholder).

Recently, BA has turned on the heat again, spending 52 million pounds last week to up its stakes in Iberia from 9.95% to 13% and re-initiating talks with Caja Madrid. Chief executive Willie Walsh emphasized the fact that a takeover would only take place in consensus.

One of the reasons for BA’s interest in Iberia (Europe’s fourth-largest carrier) is its position as a major air bridge between Europe and Latin America and, according to Walsh, the high quality of Iberia management.

New “European Las Vegas” in Spain

Aragon’s regional government recently approved a 16 billion euro project for a massive Las Vegas style resort to be built over the next decade. Currently referred to as Gran Scala (large scale), the resort will be built on 5,000 acres of land in the desert of northeastern Spain and will include five theme parks and 32 hotels.

A bullring, stadium, conference center and even wedding chapels are all part of this ambitious plan backed by a group of international entrepreneurs. According to rumor, the casino city will make Disneyland Paris seem like a backyard playground.

Spokespeople for the project are in the process of approaching the owners of the 007 movies to bring in James Bond as part of one of the theme parks, which will be entitled Spyland. Other theme parks and casinos will feature themes ranging the entire span of human history, including appearances by cavemen, Roman centurions, French courtiers to Louis XIV and KGB agents.

Spain’s Future Las Vegas Stirs Up Opposition

The slowdown in Spain’s real estate market is making its mark on the mortgage market with decreases in its main indexes. According to recent figures for November 2007 from the INE (National Statistics Institute), the capital lent to purchase a home in Spain has decreased by 13.3% compared to the same period in 2006.

This massive complex, which was considered for construction in France and Dubai, will include over 30 casinos, 70 hotels and hundreds of restaurants and shopping venues, bringing nearly 20 billion euros in investment to the area.

There has been criticism of the project, however, especially related to issues of energy sustainability. The area known as Los Monegros where the project will be built is characterized for its desert landscape and also suffers from high migration.

Many of the opposers to the project are locals concerned with corruption and the fact that a Las Vegas-like environment could attract organized crime to the area.

400 Euro Tax Cut First Act of PSOE

The 400 euro tax cut promised to taxpayers in Spain during José Luis Rodriguez Zapatero's electoral campaign will be the first measure of the socialist's second term, the Spanish Secretariat of Economy, Pedro Solbes, announced today.

Solbes said the decision will be made during the first cabinet meeting and applied retroactively back to February 1st 2008.

The tax cut was one of the most popular promises made by Zapatero, who won Spain's general elections last Sunday.

Humans Lived in Spain Over 1 Million Years Ago

A fossilized jawbone found in northern Spain proves that humans inhabited Europe well over 1 million years ago. The remains are around 400,000 years older than other human remains found up until this discovery.

Spanish archeologists theorize that early humans migrated northward from Africa, arriving in Europe and then evolving into two separate branches: the homo erectus in Asia and the homo antecessor in Europe.

The jawbone was found near Burgos and is thought to be 1.7 million years old.

The Prince and the King: Letters from Juan Carlos to Prince Felipe

A book published recently shows excerpts of letters written from Spanish King Juan Carlos to his son and heir Prince Felipe. Most of the letters were written in the 80’s while Prince Felipe attended Lakefield College in Canada.

In it, the King goes into some detail as to how he gained respect after retaking the throne following the death of Dictator Franco. It took the thwarting of a military coup in 1981 for him to be taken seriously and regarded as more than an empty figurehead.

Spokespeople for the royal family assert the authenticity of the letters, but there is a degree of confusion as to how they were made public. Following are some excerpts from the King’s letters to his son, where he urges him to become a “kind, attentive and helpful king”:

“You need to appear natural, but not vulgar; cultivated and aware of problems, but not pedantic or conceited…”

“We all are to a degree slaves of the media, which can elevate or pull down a person or an institution.”

“The press needs to be respected, but it is also necessary to make it respect you…”

Gibraltar’s Chief Minister Afraid of Crossing Into Spain

Peter Caruana, the Chief Minister of Gibraltar, is reportedly abstaining from crossing the border into Spain for fear of arrest by Spanish authorities.

The local government of La Linea (the Spanish town directly across the border from Gibraltar) has supposedly filed a suit against Gibraltar’s government for failing to handle the New Flame incident – a collision between an oil tanker and a Panamanian cargo ship – responsibly.

Paradoxically, Chief Minister Caruana’s avoidance of Spanish soil could complicate tripartite talks between Spain, the UK and Gibraltar to settle this international dispute.