Summary
The world wide credit crunch is being felt in Spain. Owners can't afford their mortgages and are moving back to thier home countries but HAVE to sell. Bargains are to be had, you just have to find them!!
Analysis
All around the world the property market seems to be under pressure and significant losses of equity are hitting the banks hard.Many Spain banks are private companies and don't diversify greatly into overseas markets, staying within the Spanish boundaries.15 years ago the property sector in Spain grew beyond all recognition and construction erupted. Most of the properties were purchased by comparatively 'rich' northern Europeans and banks bent over backwards to lend money. Demand outstripped supply so developers built more, banks lent more and the prices rose, in some areas more than 20% per annum!Banks lent based on the valuation and buyers who bought 'off plan', before construction started, had the best deals. When the property was completed and the financed arranged on the up to date value of the property 110% mortgages were not uncommon!With interest rates up properties are now being sold at less than 20% of market value. Bargains can be had but you have to look!!
