Anyone not of the understanding that the Spanish Property market has long since ground to a halt and remains in more or less that same position today is either in complete denial or quite frankly one gamba short of a paella….  Property in Spain was once as hot as the sand on its beautiful beaches in the mid August, however the building boom crashed, the credit crunch hit and as a result a huge percentage of property remains unfinished or empty and abandoned as owners have struggled to keep up with their repayment commitments.

With house prices down by over 30% from 2007, according to TINSA and the bottom of the decline a potential two years away, it has been somewhat difficult to remain optimistic about the property market.

However, there are now some positive steps being taken to ensure this troubled market sees some much needed and desired signs of life.

Properties for sale on the Calvario steps in Pollença

Repossessed second hand properties, new builds, unfinished developments and empty plots are now appearing on agents books.  This range of assets, owned by banks such as Sa Nostra and Santander, are often being marketed at a considerable discount with the main aim to release the liability from the banks balance sheets as soon as reasonably possible, but with achieving the best price at the same time.

This means that you, the purchaser, will benefit.   That is if you shop wisely and act now.  Because the secret is out, those sitting up and paying attention are already aware that ‘now’ is the window of opportunity and they are taking advantage of the low prices on offer.  One UK estate agent has reported a 17% increase of enquiries into their Spanish properties by October of this year, compared to the same period in 2011 and Spain’s very own Ministry of Development states a 12% increase in purchases by foreign investors in the second quarter of 2012 compared to the same period in 2011.  The Balearic Islands are proving to be a popular place to invest and Mallorca in particular because of its safe and secure reputation and island lifestyle.

Proposed revisions to the law surrounding the Spanish lettings market (up until now heavily in favour of the tenant) will also serve to attract overseas landlords keen to add Spanish properties to their growing portfolios and they will be taking advantage of the bargains currently on offer.  That, coupled with the recent announcement by the Spanish Government that automatic residency will be granted to foreigners investing in property to the tune of at least 160,000€  (£130,000), all points to a golden financial opportunity being here and now….

So what are the key benefits from buying bank owned repossessed or distressed sales properties:-

• Properties are being offered at up to 50% off the valuation figure quoted at the time of repossession
• There will be no chain and in nearly all cases the property will be vacant, so no delay in moving in
• You might need to factor in cost of repairs or refurbishment but this may also be used as a reason to negotiate further down from the asking price
• Automatic Spanish residency will be granted to those investing 160,000€ or more in Spanish property
• ‘Attractive tax’ offered to non resident investors

…assets are often being marketed at a considerable discount with the main aim to release the liability from the banks balance sheets as soon as reasonably possible, but with achieving the best price at the same time

Once upon a time repossessed property was not such an attractive option, the property often being in an undesirable location or in a dilapidated state, however this is now not the case and a much broader range of property is being offered, so please do take the time to consider this route if you are looking to invest in property in Mallorca

Balearic Properties Real Estate Agents are ready and waiting to discuss the issue of Bank Repossessions and Distressed Sales with you, so please don’t hesitate to call us or drop in to see us.

About Anouska
Over the years myself and my husband have loved exploring all over the world. After our first visit to Mallorca we knew we wanted to move here and make this beautiful island our home.