In a bid to get the property market back on track, the Spanish government recently announced their latest incentive to get international investors back into a buying mood.
Anyone purchasing a second home before the end of 2012 will qualify for a 50 per cent reduction in capital gains tax, when they come to sell their home in the future. Holiday or second homes bought by either individuals or companies are affected by this ruling.
The coastal regions in Spain were particularly hard hit by the collapse of the property market. A huge surplus in new built, key-ready housing stock at the Costa del Sol and other coastal regions of the Mediterranean Sea is currently coming on the market in bulk, as Spanish lenders are forced to tidy up their balance sheets and rid themselves off underperforming real estate assets.
Marbella may not be as badly affected as other areas when it comes to falling house prices and oversupply versus demand, but the town has seen its fair share of real estate woes. With the various government incentives like the one above and the 4 per cent purchase tax measure on new builds investors are finally returning to Spain in greater numbers. House viewings are up for most estate agents and while British investors are still reluctant to commit, other nationalities are buying again.
Spain still has more than 400,000 unsold homes to offload. Marbella’s market may be dominated by top-end real estate with prices to match, but a little further out of the town centre there are certainly bargains to be had. Across the nations property prices have fallen by as much as 44 per cent compared to the peak of the market in 2007. Many bank-owned housing developments are being offloaded in one large sale by lenders, not just with much reduced asking prices but also with generous offers of finance. The first 110 per cent mortgages have just been offered in Spain, which is a sign of how bad the times have become for Spanish banks.
A more typical loan to value rate is a 100 per cent mortgage for a bank-owned property. Resale homes are still a little more difficult to sell and also to buy, as mostly people with deposits of between 30 to 40 per cent will qualify for the lowest interest rates. Now that the reduction of capital gains tax has been introduced, many private sellers are dropping their prices accordingly in an attempt to lure more potential buyers through their doors.
The Malaga province alone offers some 22,000 key-ready homes, of which 10,000 are in the possession of Spanish banks. This makes it a buyers’ market more than ever before, as lenders are forced by their regulator, the Bank of Spain, to improve their balance sheets and make greater cash provisions against bad loans. Some 98 per cent of property at the Costa del Sol is deemed to consists of key-ready new builds that qualify for the 4 per cent reduction on purchase tax or VAT.
Marbella, the most famous resort in the Malaga province located in Andalucía, is home to numerous beaches, golf resorts, a wonderful Old Town, tennis courts and the wonderful Puerto Banus Marina. The town is close to other popular resorts and attractions such as the beaches and nightlife of Torremolinos, the Rock of Gibraltar, Estepona and, of course, Malaga itself, where the nearest airport is located.
With a national average of 2,900 hours of sunshine per year and the beautiful Cordillera Penibética Mountains as its protection against severe weather and rain, Marbella’s surrounding area has much to offer to would-be residents. Hikers and climbers come into their own in the aforementioned coastal mountain range.
The fauna includes golden eagles, genet cats, badgers and wild goats, while the flora boasts chestnut and cherry trees as well as maritime pines in the mountains and Sierra Blanca foothills and a profusion of marine plants like marram grass and sea thistle, which can be found at the Natural Monument site of the Dunas de Artola, one of the few protected beach areas along the Costa del Sol.