A Place in the Sun have published the results of a review they carried out in Q1 of this year. They had nearly 7,000 responses to a survey. It asked questions about Covid-19 and Brexit. The results suggest there is much to be optimistic about within the property market in the near future.

Planning to buy a property overseas

The pandemic has kept us locked down, at times in our provinces, towns, and even inside our own homes. Trying to put some sheen of positive on it, the time has allowed us to re-evaluate and decide what is really important. Over 60% of people who responded to the survey said they’ve increased the amount of time they spend researching overseas property. Distant dreams are no longer on hold.

The top three places people are using for research are reading informative articles, social media, and downloading information like buying guides. Choose an estate agent that offers all three of these to attract the most potential buyers to your property.

Unsurprisingly, 30% of respondents said they are even more determined to move overseas. For 76% of respondents, even Brexit hasn’t put them off buying in the EU. Not only are people still keen, they’re raring to go. 13% admitted they’re looking to buy sooner than they had thought at this time last year.

What people are looking for

A move abroad represents a complete change of lifestyle for many. Obvious changes are cultural, weather, and a change of scenery. Less obvious are the financial. A lot of people want to move abroad for a cheaper way of life. By selling their property in their home country and downsizing, they free up a lot of capital as well. The results prove this intent with 39% have a budget of £100k – £200k and 37% have a budget under £100k.

We have had a number of sales go through thanks to video marketing and live tours, without the buyers even being in the country. With 61% of respondents looking to move to Spain, if your property is under €230k, now is a great time to get on the market.

If you have a property you’re looking to sell or if you have any questions about the market in general, just give us a call on (+34) 643 821 326.

Foreign demand for property in Spain declined by 18.1% in Q4, compared to a decline of just 0.9% in local demand, according to the Association of Spanish Land Registrars.

Foreign buyers purchased 12,211 homes in Spain in the last quarter of 2020, down from 14,908 a year before, as illustrated by the next chart, which clearly shows the impact of Covid-19 on foreign demand in 2020.

Foreign demand by nationality

Despite coronavirus and Brexit restrictions, the British were still by the far the biggest group of foreign buyers in the quarter, with more 1th 14% of market share, followed by France and Germany at some distance. But now that ‘real’ Brexit has kicked in it will be interesting to see how British demand holds up in the first quarter of 2021 when the figures come out in a few months’ time.

The next chart compares quarterly demand in the three biggest markets and shows how British demand recovered much better between Q3 and Q4 (+17%) than France (-3%) and Germany (+3%). This might have been due to a last-minute British surge in demand before real Brexit kicked in.

The biggest annualised (yoy) declines in demand came from China and Russia, the two biggest markets for the Spanish ‘Golden Visa’. It’s safe to assume that the Golden Visa segment of the Spanish property market has been hit hardest by the Coronavirus.

As local demand held up much better than foreign demand in Q4, the market share of foreign buyers fell to 10.7%, meaning that just over 1 in 10 property sales involved a foreign buyer in the last quarter of 2020.

Next week I’ll look at the annual figures for foreign demand in 2020.

Article by Mark Stücklin

Spanish Property Insight
Spanish Property Market Analysts

 

How do international currency exchange rates affect you as a homeowner?  Many home sellers do not realise how currency exchange rates can affect them in a property market that has a large number of international buyers.  We often think of this being something that relates to banking or big business and only notice its effects on monthly pensions or the cost of goods from our home country, however it does have a big impact when selling your property to foreign buyers.

How do Exchange Rates Effect my Property?

The Best GBP to Euro Rate

In 2000, the pound was very strong against the Euro at 1.752. This meant that if you came to Spain with £100,000 to spend, you could buy a property here worth €175,200.  £200,000 became €350,400 and £300,000 because €525,600. This meant the Brits were getting extraordinary value for money.

The Worst GBP to Euro Rate

In 2008, the global financial crash had far-reaching effects. On 30 December 2008, the pound was 1.02 to the Euro. This meant that any property purchases were nearly the same price in either currency. £100k was only worth €102k; £200k was worth €204k; and £300k was worth €306k.

British Keen to Buy

After the 2020 pandemic restrictions, there is a pent-up demand from Brits wanting to get back to Spain and buy property here once again. In fact, the demand is likely to have even increased in comparison as people want to escape the feelings of confinement and are keen to take the bull by the horns. If you need to sell your Spanish property, the good news is there will be no shortage of interest.

What’s the Better News?

If you bought your Spanish property for €175,000 in 2000, you might now only get €117,000 for it. People then think they have lost €60,000. If you’re going back to the UK with that €117,000 in your pocket, you’ve actually got the £100,000 you bought the house for in the first place. There’s no better time to sell than now.

How Can That Be?

After Brexit, the pound’s value fell by 16%. Yesterday, the pound was only 1.17 to the Euro. £100,000 was worth €117,000; £200,000 was worth €234,00; and £300,000 was worth €351,000. When the pound was very strong against the Euro, this helped to fuel the rise in European house prices. However, when the pound became weaker against the Euro, spending power was reduced for UK buyers. The power was reduced but the facts are that UK buyers are still spending the same amount.

Properties in town that have a more Northern European style are currently appealing to a much wider audience of buyers, with larger rooms and less stairs.  Whilst country properties are receiving the most enquiries, it is important to have all of your legal paperwork in place and this is something we can help with and check before you begin marketing and to ensure you receive the best possible price for your property. Contact Mathew on (+34) 643 821 326 or Amy on (+34) 695 398 679.

 

 

Property experts share ‘the worst thing’ to say to an estate agent when selling your home

Local property experts, Lanjarón Property, have shared their top tips on how to sell your home. Most people will sell their homes using an estate agent (inmobiliaria). Now, our local experts have revealed what you shouldn’t say to an estate agent when trying to sell your home.

Selling your home can be a long and arduous process that can take months in Spain. From taking the right photos, to setting the right price, there’s a lot to think about when you’re looking to sell-up. Local property experts, Mathew Wood and Amy Beth Reynolds, have recently shared their top tips for homeowners looking to sell.

The property gurus often share their tips and advice on their You Tube Channel:  Click Here to see their channel

Mathew, a property expert of many years, said, “If your house has been on the market for a long time and you haven’t had many viewings, then it’s likely overpriced.”

He explained what sellers need to tell their estate agents from the beginning to avoid disappointment later on down the line.

He said: “Everything – whether it’s on a busy street corner, behind a local bar, has a goat farmer pass by with 100’s of animals – you will be able to sell it. You’ve just got to price it right.

That’s it. If you want to sell in a reasonable time frame, it’s all about the price.

Tell your agent that upfront. Explain that you understand the time to sell is relative to it being priced realistically and just be straight about what your expectations are.

Quite a lot of people think their home is worth more than it actually is. That’s normal, I get it.

But if you’re serious about selling, you do need to take the advice of a good agent because they will know what it’s worth.”

Mathew also said if you’re looking to sell your home for “top dollar” then you may miss out on the type of properties you want to buy.

“Everything is relative in a market,” he added.

 

“If everything is going up, that means whatever you sell for, is relative to what you’re probably likely to be purchasing.”

The property expert said if you’re selling your home then you should trust the advice of your estate agent.

Mathew also revealed “the worst thing” you can say to an estate agent when you’re looking to sell.

He added: “They will advise you accordingly, and do listen to them.

The worst thing you can do is say to an agent, ‘I want you to put it on for this price because I believe it’s worth this much’.

“It [your home] will just sit there.”

Amy Beth agreed and said estate agents are the market experts for a reason.

“You wouldn’t tell a pilot how to fly a plane”, she added.

Amy Beth also said good photos are especially important when selling your home, particularly when they are likely to appear on property portals. It is essential nowadays to have a video tour and for virtual viewings to be available at any time.  Buyers, especially from other countries, are used to 24 / 7 access to information on properties and will quickly move onto other properties if their enquiries are not dealt with immediately.

You can find some examples of this modern style of marketing by visiting the Lanjarón Property website here.

 

 

 

If you are thinking of moving to Spain, and you live outside of the European Union ( a non EU citizen),  you will need to apply for the correct residency visa.  The non-profit residence visa (known as the Ex-01) will be the best option for the vast majority of retirees, depending on your circumstances.

If you have an income of € 30,000 per year or more, retirees can live very comfortably in Spain, and enjoy their retirement without worry.

What is the Spanish non-profit residence visa? 

The non-profit residence visa allows people without a job to reside in Spain. You can request it while you’re still in the UK, as long as you can provide all the necessary documentation.

What documentation do I need for the Spanish non-profit residence visa? 

  1. You must provide proof that your income level is at least £2,000 per month. In most applications for this type of visa, your pensioner’s certificate and a bank statement should be sufficient proof.
  2. Private health insurance in place with a Spanish insurer.
  3. Health certificate that states that you do not suffer from any illnesses or diseases that could have serious public health repercussions.
  4. Demonstrate that you don’t have a criminal record.
  5. Prove that you have no “irregular” situation in Spain that could hinder your application (this does not apply to 99% of applicants – if you’re in doubt, talk to your solicitor).
  6. Pay the procedure fee.

Keep in mind that you must provide original documents and translations into Spanish. You can get help with this here.

 

What are the benefits of the Spanish non-profit residence visa? 

The non-profit residence visa will allow you to live legally in Spain for one year. Once that period ends, you can renew the permit for another two years, and then another two years after that (as long as you still meet the initial requirements each time).

After 5 years of living in Spain, you can apply for permanent residence.

What about tax? 

The Spanish non-profit residence visa will immediately make you a tax resident in Spain, so you will be required to pay tax, just like any other Spanish resident. This means you will have to pay:

  1. Income tax or “IRPF”. Please note that you will have to pay taxes on ALL of your income (not just income obtained in Spain). Income tax is currently between 19% and 45%, depending on your income.
  2. Capital gains tax. This is between 19 and 23% of the profit  you make from selling assets, such as property.
  3. Wealth tax or “IP”. You will pay between 0.2 to 2.5% on assets valued at more than €700,000.

Don’t forget that there are other taxes you will need to pay in Spain too, such as council tax, tax on motor vehicles etc

 

If you need any help with this or would like to discuss your options, please do not hesitate to contact us.

 

Original article by Kyero.com