Buying A Property In Spain – There’s Never Been A Better Choice Or Time.
Since home ownership became practically possible for overseas buyers in the late 1970s and early 1980s, the main obstacle has always been availability and legality.
In those early times, finding an estate agent that spoke your language in the location you wanted to live was rather hit and miss. There were very few overseas estate agents based in Spain until the late 1990s when the new build boom began.
Before that, it was incredibly difficult to locate an estate agent, mainly because there was no Internet available to carry out your research. Instead, we had box ads in national newspapers or Exchange and Mart magazine. It was difficult to find a multilingual speaker at the other end of the phone outside of the popular costas.
Most Spanish Property house hunters had little choice but to arrive in their desired location and patrol the high streets desperately seeking out an estate agent who could understand them. In most cases, you would wander into a local Spanish owned showroom, they would be very basic, often having no property on display in their windows. The result was, more often than not, very disappointing, with many hopeful buyers returning home empty handed and disillusioned.
There was simply no choice! The Spanish property market was most unlike its Northern European equivalent. It was badly organized, devoid of professional presentation and a legal minefield to the uninitiated.
The average Spanish estate agent kept their property listings mostly in their heads and not in their windows. In those days, there was very little in the way of new-build homes and the selection of golf resort properties was virtually non-existent. The general housing stock was of low quality, with poor access to the main utilities and useable road networks. Many Properties for sale in Spain were of questionable legality – to put it mildly. The vast majority of the housing stock was old, in poor condition and often totally undocumented or compromising of illegal extensions. To make matters worse, there were hardly any lawyers to specialise in property conveyance. Even today, indigenous Spanish property buyers don’t use lawyers. Instead they deal with their purchase through local notaries themselves, a process almost impossible to navigate for foreign buyers who are not fluent in the Spanish language. Foreign buyers were very much pioneers, navigating a perilous path that frequently ended in tears as well as substantial financial losses.
German and British buyers comprised the main foreign buyer’s market in those early days. Prices were attractive even when frequently doubled or tripled by the vendors sensing a gullible foreign buyer. It was quite common as a foreign buyer to hear of a property for sale in a local bar through a corredor (a local person who knew all the properties for sale in the area) After adding his fee, plus a little something for his mate who could speak pigeon English, another mate who had a vehicle that could take you there, plus a few other hangers-on, it was not unusual for a property on the local market for 3mn peseta (£16,000) to finally be offered to a British buyer for over £40,000. Amazingly, it still seemed cheap and a significant amount of foreign buyers pressed ahead and bought their bargain dream home in Spain.
As the new millennium approached, the foreign buyers market increased exponentially. A whole new market grew as many British and German expats opened up their own estate agency showrooms aiming at their home markets, fed by popular new TV programmes like A Place in the Sun. Spanish lawyers were sought to provide assistance with property searches, legal checks and official translation at the notary, where transactions were only conducted in Spanish. There were no restrictions on becoming an estate agent in Spain, you could leave Croydon or Frankfurt as a taxi driver on Friday and open your estate agency in Spain the following Monday.
The Spanish property market boomed for the next 8 years. In excess of 5 million housing units were built during that time and by end of 2009 (the financial crash) over 2 million were still unsold. Whole urbanisations and some new towns were repossessed by the Bank of Spain that had underwritten the risk on developer’s loans. Before the Spanish Property boom, it was estimated there were 20 million homes in Spain, by 2009, there were 25 million.
It took around 5 years until (2014) before the local and overseas buyers returned in any meaningful way to the Spanish property market. Then in 2016, after the UK Brexit referendum, the recovering market faltered as potential buyers across Europe postponed their plans of owning their own dream homes in Spain as the whole of Europe stood back to consider the impact of the United Kingdom – a major financial contributor – leaving the European Union.
Between 2008 and 2016, many UK nationals and a significant amount of foreign property owners, either sold up or abandoned their homes in Spain. Even the Spanish simply handed into the banks the keys to their own properties and either returned to live with their parents or rent a cheaper place due to job losses or severe income cuts. Again, by 2018, a new recovery in the Spanish Property market began. It didn’t last long though. By March 2020 the Covid_19 pandemic stopped it in its tracks and as the full impact of Brexit took hold, there was a second exodus of foreign owners back to their respective home countries. The tourist industry was put on hold for virtually 14 months, causing holiday home owners and landlords to enthusiastically dispose of their assets in Spain at almost any price.
So, as the pandemic subsides and worldwide travel returns, so too does the Spanish Property market. But, compared to the original boom times of the 1980s/90s and 00s, there are those extra 5 million plus properties. Added to that, those old low quality resale homes have been renovated and re-renovated by former foreign owners, raising the standards and improving the housing stock to northern European levels. Legalising and modernising hundreds of thousands of traditional Spanish properties. New airports, road networks and golf resorts were built and the costas received billions of euros of upgrades, not just in facilities, but also in utilities, with improved water and electrical supplies, as well as sewerage, telephone and Internet connections.
So in today’s Spanish Property market, we have over 5 million extra homes, several more millions of refurbished, renovated and improved homes, with much improved amenities all available to overseas buyer at bargain prices. Additionally, Spain now offers modern legal conveyancing, thanks to those foreign agents who moulded the legal representatives to replicated the property sales process in their respective home countries.
The new wave of Spanish Property buyers from across Northern Europe can now access more property choices than ever before, receive secure legal advice and representation at very low prices. That’s why there has never been a better time to buy a property in Spain.