Caja Mediteraneo or CAM announced the need to seek bailout funding to the tune of 2.8 Billion Euros.
Following the collapse of a merger agreement,Spanish savings bank Caja Mediterraneo (CAM) declared it would apply for state funds to meet capital requirements.
CAM was due to merge with other cajas, but three of the partners in the state-driven Banco Base merger voted against an association with CAM.
CAM which mainly operates all across Spain, has lent heavily to both property developers as well as domestic mortgages. These loans are not looking as healthy as they once did, given the downward spiral of the property market and unemployment.
Only yesterday in response to the 9Bn bailout of Caja Castilla La Mancha, Pedro Solbes Finance Minister said,
"The cajas are solvent, as is the financial system".
Thursday, March 31, 2011
Monday, March 21, 2011
National Speed limit lowered to 110km
Many people have labelled this a distraction and a revenue raising tactic....
Certainly Spain has more important issues to deal with and this measure is likely to catch driver out and therefore raise more revenue.
The goverment's claim that lowering the speed limit will increase fuel effiency by 15%. Motoring organisations claim that the figure is closer to 5%.
If the government wants people to use less fuel and raise more revenue, why not just increase fuel duty?
Tuesday, February 8, 2011
TINSA February 2011
The Spanish property price valuation index as estimated by TINSA has dropped by an average inter-annual rate of -5%
Download the latest TINSA property price index
The interannual rate of change was steadily decreasing toward the end of 2010, but the downward drive in prices seems to be showing steeper falls once again.
The biggest drops in inter annual valutaion were seen in large cities (-6.5%) and the Meditereaean properties (-8.4%)
This indicates that confidence in property prices across Spain is falling, and that prices are yet to hit the bottom.
The estimated price drops may be due to the banks revising the prcies of their property portfolios that they have respossed from people who have been unable to keep up their mortgage payments.
An increase in the unemployment figures published last month is alos likely to be a contributing factor as more and more people are forced to hand the keys to their properties back to the banks.
Bank Respossesions act as a negaitive feedback into the system, forcing prices down further.
Investors looking to purchase at the bottom of the curv would be best advised to bide their time.
The general message to potential buyers is to continue waiting as property prices continue downwards.
Those looking to move to Spain would be best advised to rent.
Download the latest TINSA property price index
The interannual rate of change was steadily decreasing toward the end of 2010, but the downward drive in prices seems to be showing steeper falls once again.
The biggest drops in inter annual valutaion were seen in large cities (-6.5%) and the Meditereaean properties (-8.4%)
This indicates that confidence in property prices across Spain is falling, and that prices are yet to hit the bottom.
The estimated price drops may be due to the banks revising the prcies of their property portfolios that they have respossed from people who have been unable to keep up their mortgage payments.
An increase in the unemployment figures published last month is alos likely to be a contributing factor as more and more people are forced to hand the keys to their properties back to the banks.
Bank Respossesions act as a negaitive feedback into the system, forcing prices down further.
Investors looking to purchase at the bottom of the curv would be best advised to bide their time.
The general message to potential buyers is to continue waiting as property prices continue downwards.
Those looking to move to Spain would be best advised to rent.
Sunday, February 6, 2011
Market report for 2011
Nick Hagan a reporter from adferro asked me 4 questions:
Will we see an ongoing decline in Spanish property prices in 2011 ?
The best data indicates that prices are still falling and will continue to do so throughout 2011. The rate of decline appears to be falling so those looking for the bottom of the market should probably continue to wait.
Will low-rate mortgages continue to be widely available in Spain?
Most analysts are predicting modest rate rises but finance is still relatively cheap and easy.
The easiest way to get finance is to purchase a property from the bank itself, many are offer rent to buy options or low or no deposits. That said bank repossessed properties don't always offer the best value for money.
What should bargain hunters be looking for when searching for Spanish property?
Bargain hunters should be looking for "Pre-repossession distressed property". This is property that still has equity, where the owner cannot keep up to date with the payments and is in a position where he is forced to sell or give the keys to the bank. These properties often represent the best value for money.
As the banks that have been forced to repossess properties need to liquidate these assests, they will have to reprice their property portfolios. Look out for bank properties that have been significantly reduced in price.
Don't pay the full asking price. It's a buyer's market, make a low offer
More generally, what are your predictions for the Spanish property market in 2011?
I think we will see a modest improvement in the number of transactions as the bargain properties are hovered up.
The conditions that have caused the crisis in Spain are not going away:
Will we see an ongoing decline in Spanish property prices in 2011 ?
The best data indicates that prices are still falling and will continue to do so throughout 2011. The rate of decline appears to be falling so those looking for the bottom of the market should probably continue to wait.
Will low-rate mortgages continue to be widely available in Spain?
Most analysts are predicting modest rate rises but finance is still relatively cheap and easy.
The easiest way to get finance is to purchase a property from the bank itself, many are offer rent to buy options or low or no deposits. That said bank repossessed properties don't always offer the best value for money.
What should bargain hunters be looking for when searching for Spanish property?
Bargain hunters should be looking for "Pre-repossession distressed property". This is property that still has equity, where the owner cannot keep up to date with the payments and is in a position where he is forced to sell or give the keys to the bank. These properties often represent the best value for money.
As the banks that have been forced to repossess properties need to liquidate these assests, they will have to reprice their property portfolios. Look out for bank properties that have been significantly reduced in price.
Don't pay the full asking price. It's a buyer's market, make a low offer
More generally, what are your predictions for the Spanish property market in 2011?
I think we will see a modest improvement in the number of transactions as the bargain properties are hovered up.
The conditions that have caused the crisis in Spain are not going away:
- Massive unemployment
- Bank repossessions
- A huge glut of property on the market
- The global financial crisis and property crisis continues to exert a downward pressure on prices.
Thursday, January 27, 2011
Spanish court rules that repossession cancels debt
A court in Pamplona, Navara in the North of Spain ruled that reposession of the a debtor's property cleared the debt owed.
Previously a mortage debtor, whose property was reposessed and subsequently sold for less than the debt, continued to owe the remainer.
The bank, BBVA, sued the borrower to reclaim 28,129 euros of debt outstanding on a 71,225 Euro mortage after respossessing the property and then selling it for for 42,895 euros.
The judge ruled it was "morally repellent" that the bank should make additional claims on the borrower. BBVA plan to appeal the decision.
There have even been cases where EEO order have been used to pursue a debtor in another European country.
If the ruling is upheld at appeal, it's likely to encourage more conservative bank valuations, make loan to value ratio lower and make mortgage lending conditions in general tougher.
Previously a mortage debtor, whose property was reposessed and subsequently sold for less than the debt, continued to owe the remainer.
The bank, BBVA, sued the borrower to reclaim 28,129 euros of debt outstanding on a 71,225 Euro mortage after respossessing the property and then selling it for for 42,895 euros.
The judge ruled it was "morally repellent" that the bank should make additional claims on the borrower. BBVA plan to appeal the decision.
There have even been cases where EEO order have been used to pursue a debtor in another European country.
If the ruling is upheld at appeal, it's likely to encourage more conservative bank valuations, make loan to value ratio lower and make mortgage lending conditions in general tougher.
Tuesday, January 11, 2011
January TINSA 2011
The Spanish Property Market continues it's downward trend for the third concurrent year.
The properties leading the downward trends are those situated in the larger towns and cities and those situated on the Mediterranean costas.
TINSA estimate that prices have seen a year on year fall of 3.9%, with Mediterranean Properties dropping by an estimated 6.8%
The tinsa index can be downloaded here:
TINSA December 2010
2011 is likely to see the banks reprice much of their repossesed stock of property, meaning that prices are likely to continue to fall.
So in the mean time the genral advice is to rent until you find a bargain.
It's possible to rent a three bedroom two bathroon town house in the Port of Mazarron for as little as 500 euros per month
The properties leading the downward trends are those situated in the larger towns and cities and those situated on the Mediterranean costas.
TINSA estimate that prices have seen a year on year fall of 3.9%, with Mediterranean Properties dropping by an estimated 6.8%
The tinsa index can be downloaded here:
TINSA December 2010
2011 is likely to see the banks reprice much of their repossesed stock of property, meaning that prices are likely to continue to fall.
So in the mean time the genral advice is to rent until you find a bargain.
It's possible to rent a three bedroom two bathroon town house in the Port of Mazarron for as little as 500 euros per month
Tuesday, December 14, 2010
December 2010 TINSA index
The December Tinsa Spanish property price index report estimates that prices are falling at an inter annual rate of 3.6%.
This is the 36th consecutive month that TINSA have opined that residential property in Spain has fallen in value, with the Balearic Isles and the Mediterranean coast falling by the highest margins.
TINSA's index implies that prices aren't falling as steeply as before. Oversupply, massive unemployment and weak demand continue to drive down prices.
The market analytsts, Fitch, have estimated that the down turn in prices will continue throughout 2011.
The rate of decline has been slowing since a early 2009, a simple extrapolation of the change in rate indicates that the market should bottom late 2011. However other factors may come into play, forcing prices down further. The withdrawl of extra unemployment benefit in February and the repricing of Spanish properties held by the banks is likely to depress prices further.
This means that those wishing to move to Spain should probably consider renting rather than purchasing at this stage. It's a buyers market so take your time and start by making a low offer.
The TINSA index is based on the opinion of valuers, rather than actual sale price data. The word on the street is that there are some great bargains out there, but there is a lot of property over-priced on the market.
Original article Spanish Property Magazine
This is the 36th consecutive month that TINSA have opined that residential property in Spain has fallen in value, with the Balearic Isles and the Mediterranean coast falling by the highest margins.
TINSA's index implies that prices aren't falling as steeply as before. Oversupply, massive unemployment and weak demand continue to drive down prices.
The market analytsts, Fitch, have estimated that the down turn in prices will continue throughout 2011.
The rate of decline has been slowing since a early 2009, a simple extrapolation of the change in rate indicates that the market should bottom late 2011. However other factors may come into play, forcing prices down further. The withdrawl of extra unemployment benefit in February and the repricing of Spanish properties held by the banks is likely to depress prices further.
This means that those wishing to move to Spain should probably consider renting rather than purchasing at this stage. It's a buyers market so take your time and start by making a low offer.
The TINSA index is based on the opinion of valuers, rather than actual sale price data. The word on the street is that there are some great bargains out there, but there is a lot of property over-priced on the market.
Original article Spanish Property Magazine
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