Holiday properties in Spain are proving difficult to sell with owners, agents and banks trying to entice buyers with an ever increasing range of desperate measures.
Spain has around a million newly built properties that are languishing on the market and almost half of them are holiday homes on the coast.
Areas that were once popular with foreign property investors such as Valencia, Murcia and Andalucia are now full of unsold new homes. There 46,366 unsold on the Costa Blanca, 30,027 in Valencia, 27,279 in Murcia, and 21,902 on the Costa del Sol, according to figures published in Spain.
One of the main causes is lack of credit but Spain’s bad track record in terms of illegal building and corruption among local planning officials has also had an effect and led to less demand from foreign investors.
An examination of what is going on in Spain reveals some desperate measures from owners, banks and real estate agents. They have teamed up with canny entrepreneurs to shuttle investors around apartment blocks many of which are being offered at half price or less.
Organisers of one bus tour in the popular holiday resort town of Marbella said it has sold 20% of the properties on its books in the last six weeks. ‘It’s such a simple idea and just snowballed,’ said Africa Leon, whose promotions company Circulo Financiero Internacional organises one tour.
Victoria Ansola, a property consultant who normally seeks out Costa del Sol apartment blocks on behalf of German and US funds found it useful. ‘It’s comfortable, they take you around, you can get five appointments in an afternoon, and then you can return and negotiate,’ she said.
One lawyer is even organising young people into groups to buy. Emilia Zaballos said it was to let everyone have access to buying property and not just professional investors. ‘It’s totally innovative. This is not just for investors. Anyone can access these kinds of bargains,’ he said.
But these ploys don’t always work. Offering big discounts, for example, has not lead to a rush of bargain-hunting buyers parting with their money. A leading Spanish estate agent has held two property bazaars for holiday homes with discounts of up to 60% but the result was poor compared with similar offerings of first properties in big cities like Madrid.