Spain's conservative popular party led by Mariano Rajoy have won a sweeping election victory  because voters think they offer a better future for Spain. This could be more good news for property investors in the southern regions.

Reports are already coming out that tax breaks may be introduced to stimulate the country's property market which is a vitally important component of Spain's economy. This comes on the back of signs of recovery in micro markets such as Marbella where investors are taking advantage of a once in a lifetime opportunity to invest in property at significantly below market value.

Prices have fallen 24% nationally in real terms since the peak of the market in 2007 leaving much of Spain and the banks who are heavily exposed to the property sector looking for ways to balance the books and stimulate recovery.

Behind the headlines there are signs that recovery could be well underway already in some of the more desirable, fashionable resorts like Marbella - a magnet for the rich and famous and now a realistic proposition for the average investor.

'Be greedy when others are fearful' The famous quote by Warren Buffet should act as an important reminder of one of the most important secrets of a successful investing. People are fearful about Spain's economic situation, the banks are worried about recouping the money they have lent to property developers, and the developers are distressed about selling their inventory, which is precisely why now is a fantastic time for canny investors to take advantage.

The Banks and Developers Are Rolling out the Red Carpet

When the real estate bubble was inflating, as with elsewhere in Europe the housing market in Spain could do no wrong, Spanish banks like Banco Santander and Banco Bilbao Vizcaya Argentaria were falling over themselves to lend to real estate developers.

Following the burst of that bubble the good news is they are now turning their attention to buyers! 

The pressure is on to sell which means that developers are willing to heavily discount their properties to compete with their rivals as they are unlikely to enjoy the same friendly agreements with banks for some time which means a less construction and a more realistic ratio between supply and demand in the future. 

Unlike most other countries in Europe, banks are falling over themselves to offer great mortgage deals -  just 6 months ago, you would need to raise a 30% deposit a situation which clearly wasn't working. Now it is perfectly possible to secure 100% + of the purchase price which means you can now buy a dream property in Europe's premier holiday resort with no capital.
 

Has there been a better time to buy a holiday home in Spain?

Of course you wouldn't expect banks and developers to be gifting property and finance to you to the tune of million of euros, but these are unprecedented times. They may even regret their decisions as the UK Labour government did when they sold off the nation's gold more than a decade ago. Panic does funny things to people, financial institutions and governments.

If current market assessments are correct there are signs that the housing market in Spain has already turned a corner on the coast in Marbella, Murcia, the Costa Blanca, and Barcelona which all recorded positive price growth in the previous quarter after a long period of declining prices.
 

When you look at a property market, be it a micro market or an east European city, one of the key long term indicators you look for is a willingness by government to investment in infrastructure. Major schemes such as the expansion of Malaga's airport and the coastal railways and plans for a new Disney Park on the Costa Del Sol look set to provide a huge boost to local economies that will benefit from increasing tourism.

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For further information please contact:
Brett Tudor
brett@ipsbmv.com
0844 800 6661 or 07969502781