Bargain Houses For Sale In Spain

Have Banks Really Got Good Bargains?

On being sent some clients coming over to Spain from Canada to buy amazing bargains straight from the bank at huge discounts I was inspired to write this article just to clarify things. So what is the truth about all of these huge bargains being offered by the banks? Is BMV Property for Sale in Spain achievable through the banks

Simply put there are not many of them if they exist at all.

Firstly, they must be properties that have been through the repossession process so that they are free for the banks to sell on. This is not as easy as it sounds as the repossession process takes time and the courts are totally backed up with judges going on strike regularly due to the lack of help (Too few civil servants) Secondly, the banks must be willing to accept the mortgage price or an offer below the mortgage price. Most of the repossessions are on mortgages granted in 2006 and 2007. These mortgages were generally given at 100% of the cost of the property at the time. As prices have now dropped by around 25% from the peak officially speaking and more anecdotally speaking, if the bank offers them at mortgage price they are not bargains. If they allow discounts, the discount needs to be deep, very deep. 15% off mortgage cost is still above current market value. Thirdly, and possibly most relevant, if there is a great deal in the bank then the employees are taking them. The Santander offered their portfolio to their employees earlier in the year and sold 350 properties in a week to their staff. They didn't sell another 350 the week after though because the cherry picking had been done. I have seen their listings and there is nothing that turns me on from a price point of view. The same goes for other banks whose portfolios I have seen. They are not willing to take a big hit so they prefer to hold, and possibly rent out to the previous owner with an option to buy rather than selling on at a big loss. Now there are exceptions but they are few and far between. Spain is not Florida and you cannot come here and expect to buy at 10% of value. Where are the exceptions then? Well if you are buying at the top end of the market there are huge bargains and discounts to be had. Why? Well the original buyer at that level did not gear themselves highly and therefore there is more equity available. The owners generally want to take out some equity or the banks are on their tails for a large mortgage cost per month so they accept deep discounting. Typically you can get properties at between 30-50% off real values for motivated sellers. Secondly, the discounts at the lower end of the market are also tempting if you can find the right seller. The best case scenario is a low mortgaged Brit returning to the UK as generally they bought when the pound was at 1.47 Euros or more and they are now selling at 1.06 or less. Just to give a quick example with simple figures. Soembody who bought at 100000 Pounds at 1.47 Euros can accept 106000 Euros and still recoup their original investment, a paper loss in Spain of 41000 Euros. Equally if they bought at an earlier time when the Euro was at that rate and the property is to be sold at a higher price than purchase their capital gain is negligible which is also quite cool. eg Buying at 150000 Euros and selling at 160000 would not incur a capital gain as the 10000 gain can be justified from the taxes, but on taking the money back to the UK their actual capital gain may well be 40000 Pounds due to currency fluctuations. Therefore what is the conclusion? Well, you should buy off a low mortgaged Brit returning to the UK who is really keen to sell. You will find plenty of those properties on the Valencia Property website. Related Stuff 1) Valencia Property Videos on You Tube 2) Video Introduction to the Success in Spain Audios 3) Waking Up In The Sun A State Of Mind