The Property Market is moving again. The number of mortgages taken out in January this year is up 9.2% on the same month in 2017 and the amount borrowed has gone up by 7.9%. These are the latest figures from the Spanish Statistical Institute (INE) published Thursday 22nd April and they paint a very confident picture. Mortgages for property in Sotogrande tend to be around 70% of the asking price for non-residents and can be as high as 80% for residents. The same is true inland in the villages like Jimena de la Frontera and Gaucin. Prepare yourselves; the best bargains are getting mopped up fast.
We have just sold a property in Jimena which was bought for 70,000€ cash. The lawyer had to tell the Buyer that this was lower than the price the Hacienda calculated as the ‘Real Price’. The Buyer paid the 8% tax on the Title Deed Price and chose to wait until the Tax Authorities calculate the shortfall. (Which they will). This will add another 3,200€ because the government says the property is really worth 110,000€.
Winners and Losers
Bad luck for the Seller, our client, who had cash flow problems and needed to sell, but on this occasion the lucky winner was the Buyer. There was a similar example in Sotogrande Marina, where a 2 bed sold for 280,000€ when the asking price was 315,000€. Plus, a villa in Sotogrande sold for 1.4 million € negotiated down from 1.7 million €
Still A Buyer’s Market . . .
Properties are out there. So, too, are mortgages: fixed rate and variable for long and short to medium term investments. Cash buyers can complete quicker which can give more negotiating ‘clout’, but those buying with mortgages can also put in a ‘cheeky’ offer. In this sense, it is still a buyer’s market. But, to quote Bob Dylan, ‘the times they are a changing’.
It looks like Sellers who can afford to sit and wait a year or 18 months before putting their property up for sale should get a better price. So, our advice? Buy now.
This article appeared in the Euro Weekly News 12-18th April 2018