Welcome to today’s email alert…
Ambrose Evans-Pritchard, The Telegraph’s International Business Editor in London, offers an outlook. ‘Be careful if you are planning to buy a house in France. The EU stress test for banks just released expects French property to fall 1.6 per cent this year and another 1 per cent in 2015 even if things go well.’
‘An adverse scenario is a cumulative drop of 31 per cent by the end of 2016. This reflects the worries of French regulators who fed the data to the European Banking Authority. Romania competes for horror. Italians deem their country less volatile. Spain falls 4.3 per cent this year, then starts to recover. The worst case is a 10.4 per cent drop over the next two years with rebound by 2016 even in a crisis. The Spanish regulators are delightfully optimistic as usual, seemingly living in a parallel universe.’
Accommodationforstudents.com, AFS, cautions landlords that the student exam season is almost over and will be swiftly followed by a mass exodus of students from their rented accommodation as they return home for the summer. ‘Organising a professional company to produce an inventory at the beginning of the tenancy and a pre-checkout meeting with students a couple of weeks in advance of them moving out could be the answer to avoiding a dispute altogether. It helps landlords maintain a positive reputation and gives students, who are often renting a home for the first time, a better chance to receive their deposit back.’
‘It’s an opportunity for landlords to resolve any problems in advance, or at minimum, ensure that an independent third party explains what the potential issues are so that the students are clear about grievances that may arise. In particular, if items are damaged or missing, it gives students a chance to source and replace them, as well as carry out any necessary works (cleaning, fixing etc), instead of it being deducted from the deposit or attempting to resolve discrepancies on leaving day.’
‘Student landlords should expect scuffs and scrapes, but not burns in the carpet or holes in the walls. The term is not explained in law and is very much a case of considering the merits of each incident – this is very much where a reputable, independent third party can be of enormous benefit. A pre-check out meeting also gives students time to discuss house matters with their house-mates, sharing any potential costs and responsibility before they head home for the summer, hundreds of miles away from each other.’ Food for thought.
Growing interest in Spain amongst members so we have been looking at the new findings from the General Council of Spanish Notaries. Have to say, it’s more positive than it has been in some time. Key findings? Q1 2014 sales are up 45 per cent compared to Q1 2013. Mortgage loans are up 48.3 per cent over the same period. Note, of course, that we are
starting from low bases here. Interestingly, for those who focus on price per square metre, the average price over the year to the end of March 2014 is down 4.8 per cent to €1,248.
As mentioned previously, Chris Mercer of Mercers in Murcia suggests ‘mortgages’ are the issue that are restraining a real recovery. ‘If the Spanish government really wants to give its economy a shot in the arm, the banks should relax their lending criteria. The maximum loan-to-value for non-residents in Spain today is around 60 per cent. However, the purchaser also needs to pay up to 15 per cent of the purchase price in taxes and fees so, unless you’re buying a bank repossession where they may lend up to 100 per cent or more, you really need easy access to around half the money to buy a Spanish property. This debars a large number of people who require larger loans.’ Meantime, there are big opportunities here for those with cash.
All for now, see you soon.