Costa del Crash! Spain's property prices set to slump 50pc with British holiday homes on coasts 'worst hit'

• Up to 2million properties languishing on the market that cannot be sold
• 400,000 Britons either live in Spain or own a holiday home
• Experts warn house prices may not begin to recover for up to 15 years

Hundreds of thousands of Britons living in Spain or with holiday homes there risk being the worst hit as property prices  continue to plummet.
Analysts warn values could slump by another 50 per cent in the crisis-hit nation, with the biggest falls in coastal areas full of apartments and villas owned by those from the UK.
The slide threatens to be so bad that swathes of half-built or unsold holiday homes along the Mediterranean coast will simply have to be demolished as no-one wants them, even at rock-bottom prices.

Hit: Costa Malaga has always been a popular destination for British tourists but house prices are falling rapidly

Plummet: House prices in Marbella have already fallen 50 per cent

The warning came from RR de Acuna & Asociados, one of the country’s leading economic consultancies. It predicts the relentless gloom could stretch more than a decade – even up to 15 years – with falls of up to 50 per cent along the coast where around 400,000 Britons live or own homes.
Group vice-president Fernando Rodriguez de Acuna said: ‘The market is broken.
‘In places like Castellon [near Valencia], where over-development was mad, banks are not financing anything and there is a high prob- ability these properties will never be sold. They will have to be knocked down.

THE PROPERTY CRASH IN NUMBERS

• Spanish bank Santander slashed house prices by 60 per cent to clear backlog
• 800,000 houses are still on the market
• 250,000 are currently being built
• 300,000 homes have been foreclosed
• House prices in some areas not expected to recover for 15 years
• Houses in Marbella already fall 50 per cent

‘Banks are offering huge  discounts and nobody is calling. Marbella has already fallen by 50 per cent and prices are going down and down.’
The firm’s latest analysis suggests the total decline from peak to trough could end up at 75 per cent in some areas.
The downturn has blighted the retirement of Valerie Burch, from Brixham, Devon, who planned to sell her seafront duplex apartment in Caleta de Velez, east of Malaga.
It was worth £180,000 in 2008 but has dropped by a third to £120,000 by September. The 72-year-old said: ‘I am devastated. I was thinking of selling this year to help me in my retirement but I would never recoup my investment.’
Mr Rodriguez de Acuna said there were almost two million properties waiting to be sold, with ‘no progress at all’ over the last five years to clear up the backlog.
He expects the crisis to also hit the capital Madrid and major cities like Barcelona, with prices down 30 per cent and no pick-up until 2018.
‘There are 800,000 used homes on the market,’ he added.
‘Developers are sitting on a further 700,000 completed units.
Another 300,000 have been foreclosed and 150,000 are in foreclosure proceedings, and there are another 250,000 still under construction. It’s crazy.’
Spain was booming until the credit crunch of 2008, with hundreds of thousands of properties built every year.
But the country has been one of the worst hit by the eurozone crisis and has a shrinking economy with a jobless rate of more than 26 per cent.

How to spot the timeshare frauds.

Timeshare salesmen and agents have been sleazing their way across the hotspots of Spain for numerous years, using high pressure sales techniques to bully unwitting holidaymakers into purchasing something that they were never really entirely sure about in the first place.

However, now a new blight is causing current timeshare holders an even greater headache. Trying to locate a legitimate timeshare resales company on the internet is like attempting to find the proverbial needle in a haystack. Here are some things to look out for when buying and selling timeshare to keep the fraudsters at bay.

Buying timeshare

For those who understand the timeshare market and are comfortable with the financial commitment, there is still a great combination of value and luxury to be had by making the right purchases. However, like any financial investment, this should be done in your own sweet time.

If they approach you, it’s a no go

It doesn’t matter how the company say they got your details, if you haven’t dealt with them before then now is not a good time to take a chance.

Search online or by brochure

Reputable companies will have at least some of their listings available online or by brochure. This way you can work out what is available and at what cost without having to talk to a salesman or woman.

Check their name

Always do your homework on a company before doing business with them. A good way of checking their reputation is to search the discussion and forum results on Google for feedback on the company’s services.

Tell them precisely what you are interested in

When you make your first enquiry, be sure that you know what you are looking for. Do not give them an opportunity to force a timeshare on you that you’re not interested in. If they make you a proposal, be firm in stating that you will get back to them rather than vice versa. Make sure that their conveyancing fees are detailed in full and explain that you will not pay a penny more than what you have just been quoted.

Never part with your details until deeds are in your possession

Once you settle on a deal, be sure to cover yourself against fraud. Never part with cash until you have received official documentation and always have a lawyer check the paperwork over. If you must give your details to the agent before completion, a credit card is the best bet.

Selling timeshare

This is where things have started to get really ugly in recent years. With the recession resulting in people tightening their belts, many saw selling on their timeshare as a wise move to generate some extra cash. This desperation has been fully capitalised on by faceless fraudsters who will scam hundreds of pounds from timeshare owners in listing fees and facilitation costs. Make sure you’re not caught out.

Consider the sale

Talk to other people who own timeshares and communicate on the independent <a href="http://www.timesharetalk.co.uk/" target="_blank">Timesharetalk</a> forum. Is there actually a market for your timeshare? If other people are having difficulties selling similar timeshare weeks or points then the listing fee charged by timeshare resales companies may not be worth it.

Understand the value of your timeshare

There is precious little chance that your timeshare has appreciated in value and if a timeshare agent tells you they can sell it for more than face value, they are probably lying in a bid to get you to list with them. Don’t get reeled in, as if you agree your timeshare could sell for a sizeable figure, the agent will have greater scope with which to charge you a hugely over-inflated listing fee.

Take time to think

If you tell an agent you would like time to consider whether to sell with their company, make sure you follow through and end the call. Dishonest companies will at this point start to offer you lower rates, tell you that a buyer is waiting or declare that there is an important deadline coming up that you may miss. If they do any of the above then you’ll know not to call back.

Check their advertising

Take a thorough look at the website of the company you intend to sell through. Are they properly showcasing available timeshares? If you don’t feel your timeshare will receive sufficient advertising then look elsewhere.

Pay once only and don’t pay over the odds

You should only ever pay one listing fee and it should never be more than you expect to receive for your timeshare. Compare the quoted price with other timeshare holders on Timesharetalk.

Be prepared to wait

Even the most reputable timeshare resales companies may have trouble shifting your timeshare as the market is not as strong as it once was. However, they should keep you updated on any progress and should never ask you for more money. A timeshare in Spain can be difficult to shift but if you list with reputable, long-standing companies that are accredited members of the RDO (formerly the OTE), TATOC and ARDA then you will give yourself the best chance of moving it on. It pays to do your research when it comes to timeshare sales, so be careful out there!
 

Written by: Nick Woolnough

for: Eye on spain.