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Original article: Property blog
According to Spain’s national institute of Statistics (INE) the collapse in property sales may be coming to an end. Based on the latest figures from July (link below), there were a total of 37,079 property transactions in the month, of which 33,694 were standard sales and 3,345 were social housing (VPO).
Looking at non-VPO sales for a moment, that is a decrease of 19.6% year on year. Not necessarily a good figure, but compared to earlier in the year there has been a marked improvement in the level of sales with an increase month on month of 5.8%. Finally a positive bit of news!
On another interesting note looking at the figures for Spain, of the total properties sold 18,688 were for newly completed properties and 18,351 were for re-sales. This is the first time in recent years that both of these categories have reached parity. Generally new properties have made up a higher percentage of the total over the last year, due to the off-plan property boom in recent years. But with fewer and fewer off-plan sales from the ‘boom’ left to go to completion, this figure should continue to decrease and re-sales should once again make up the majority.
But this does not mean there will be no more new build sales. There are still many promotions on the market still looking for buyers. So, we can expect the figure to continue to decrease, as the best new build properties will sell first, and the less popular will continue to drop in price until there is demand. Although I could be wrong on this matter and the new build figure might suddenly plunge to next to nothing! Unlikely, but still a possibility.
Now for a bit of positive news for us here in Andalucía. Of the total 37,039 properties sold in Spain, 7,898 were in Andalucía. That 21.1% of the total. Or 1 in 5 of all properties sold in Spain!
So although the figures are better for July than for June, year on year, they are still down. And of course they are lower than the 2007 peeks. But if this trend continues we might soon see the end of this long dark tunnel
INE Report
Regards
Andrew Belles
Costa del Sol property
10 year newbuild property insurance Spain ‘Seguro Decenal’
Since may 2000 it has been obligatory in Spain for ‘Promotors’ or property (normally the developer) to take out a ‘Seguro Decenal’, in order to cover the building, should it be subject to any significant defects that affect it’s structural stability and resistance.
Firstly it is important to note that most builders will opt for the basic obligatory cover. While optional cover is available to cover elements such as the water tightness of roofs and walls, many builders will not take additional cover and though elements that affect the habitability of the building may need to be rectified by the builder up to 3 years from the date of completion (see below), after 3 years it’s only the remaining 7 years of the 10 year policy that can be called upon. Many owners therefore find that having found problems with their Spanish property after 3 years, it is only those defects that affect structural stability that can realistically be pursued with the insurers. The correct diagnosis of problems and identification of structural relevance is therefore important.
Post purchase calendar:-
First 15 days: Owners should report any evident defects to the builder, who then has 28 days to rectify them. Significant omissions may even give the owner an opportunity to withdraw from the purchase, though in practice this may be lengthy and costly to achieve. (Such defects are best identified prior to completion and corrected before final monies are paid as the current market has seen many builders folding)
First year: In the first year the builder is liable to correct all defects reported to them. What’s important here is that the builder repairs defects properly and doesn’t just bodge them up to last for a short period. The first year is the best opportunity to get things put right properly. The right repair works are therefore essential including the use of the right materials, otherwise problems are likely to reoccur later (when claiming may be very difficult). While a conscientious builder may opt to properly correct any problems, others will be looking for the cheapest option. Unfortunately, some of the most serious defects might take some time to show up.
Second and third years: Over the next two years, the builder is still responsible for repairing major defects that would make the property inhabitable. But of course such issues can be difficult to argue. While flooding from a leaking pipe or roof may be the obvious responsibility of the builder, lesser issues may not get any response and BE WARNED! Some builders can be impossible to pin down, evading responsibility by claiming insolvency, changing their company name or simply disappearing.
Unfortunately some builders see the 10 year obligatory insurance in Spain as a way out of responsibility and in extreme cases it has actually resulted in builders skimping on crucial details such as foundations because -‘it’s insured so we’ll cut corners’, it’s therefore important to understand that whilst a good insurance policy may protect owners it does not automatically mean that a new property is better built than one that is 30 years old. Whilst the terms of most policies will require an increased level of control (e.g. most policies require that a site substrate test is carried out – ‘estudio geotecnico’ and that works are overseen by an ‘Organismo de control tecnico’ – ‘OCT’), a general lack of control and a tendency for some Architects and ‘Tecnicos’ to turn a blind eye to the poor practices of builders that give them lots of work (and money), results in defective or sub standard elements slipping through.
First ten years: The builder (normally ‘Promotor’ but see below!) must take out seguro decenal insurance. This is the ten year policy covering the costs of repair in the event of a structural failure in the building. Remember it may well not cover other defects, so if you can’t find the builder or they simply won’t repair, the 10 year policy may not be of any help, other than for cases of structural failure.
What if there is no policy?
I have seen an increasing number of cases where no policy is in place. This occurs through a ‘loophole’ whereby an ‘auto promotor’ (owner/developer) has built the house for their own occupancy with the intention of living in it for the duration of the first 10 years. Through a lack of understanding at the time of purchase, the builder may submit all paperwork showing the buyer as ‘Promotor’, therefore the obligation to take out the insurance (if they intend to sell on within 10 years) rests on their innocent shoulders. It is only later when they encounter defects, try to register / mortgage or sell the property, that the non-existence of a policy may come to light. Furthermore, as the insurers like to specify a level of control during the construction period, it can be difficult to get insurance post completion.
Will the insurers cough up when needed?
If there is a strong enough case that meets the terms of the policy, yes, they are obliged to pay, but of course the insurance assessors job is to wriggle out of any responsibility. Commonly they may initially claim that an issue is nothing to do with them but instead down to the builder. This may be correct if the issue is simply not covered in the policy, but if it is covered (and all issues that affect the structural stability have to be), it is their responsibility to pay out for such issues, whether the builder is around, absconded or bankrupt.
Of course where a serious omission has occurred due to builder negligence, the owners may not be confident in the same builder correcting the problem and if you are really unhappy about the original builder ‘having a go’ at correcting a serious structural defect, it is important to stress this lack of confidence to the insurers, which in turn will help to highlight the fact that this is their, rather than the builder’s responsibility.
Will the courts need to be involved?
Unfortunately the process of getting any parties to admit to responsibility can be drawn out and sometimes fruitless, such that a court decision may be needed to force one or more parties to pay up. The good news is that there are some specialist lawyers with experience in such cases, and the good ones won’t advise you to proceed unless you have a decent case. Of course all court actions carry some risk and ultimately the decision to proceed will be down to the owner, for this reason is it often the larger claims that merit court action. In some cases for minor issues, it may be worth simply getting a decent builder in to put things right. A Building Surveyor’s report is advisable so as to clearly establish what the defects are and how they might be corrected including costings. This is sometimes backed up with an Architect’s second opinion, though it should be noted that in Spain not all Architects will have the defects knowledge of a building surveyor and hence should not be solely relied upon for initial diagnosis.
When entering into a claim, it often soon becomes clear that the builder, architect, town hall and insurer are all keen to ‘pass the buck’ when it comes to identifying who was actually negligent and in some cases it may actually be all parties. Don’t take no for an answer from the insurers. Theoretically if there is an obvious defect covered by the policy, they should pay up without the need for court action, but in reality getting them to dip into their pockets can be a difficult process.
Trust no one!
Or at least trust no one that was involved in the original build process and purchase. While you may get one or more of the parties clearly on your side, it is common for all involved to try and make light of what may be a very serious structural issue. Commonly the Architect or Tecnico involved in controlling the project will come up with an understated report or inadequate short-term solutions. I am often called in to examine a project Architect’s or builder’s proposed ‘solution’ and many of them are simply not good enough (some have already proved to have failed). Provided that evidence is submitted to the insurers or courts to demonstrate the inadequacy of such ‘remedies’, they are fortunately very willing to listen to independent expert opinions, other than those of the parties involved in the project, so if you are not making positive progress get independent advice for both structural and legal issues.
Protecting yourself:-
If you are buying a newbuild get your solicitor to check that the decenal insurance is in place (and included with your deeds), that it is not your responsibility as ‘Promotor’ and that the cover is adequate for your purposes, (you may wish to pay the extra for a ‘belt and braces’ policy extension).
The sooner you report defects to the builder (in writing) the better, so it’s worth having a snagging survey check and further check before the 3 year and 10 year deadlines expire (especially if there is any evident cracking in the building structure).
The most critical defect commonly involves inadequate foundations, and you should take every opportunity to ensure that your newbuild includes adequate foundation design and control, even if this means paying the builder more money to carry out necessary sub ground works.
The current market downturn means that many builders are in financial difficulty. It is hence best to get all defects remedied prior to payment of final monies.
NB:- Information for advice purposes only. Proper legal and safety procedures should be followed for all property purchases and building works.
Copyright- Mark Paddon 2009
Spain boasts just about everything you could ever wish for in a holiday destination.
This popular European country has a fantastic climate, a wealth of culture and history, some amazing and diverse landscapes, numerous tourist attractions, lots of great food and drink and a huge range of self-catering holiday properties to rent during your stay in Spain.
As one of the world’s top tourist destinations, Spain truly has something to offer all tastes, whatever type of holiday you’re looking for, whether it’s an annual family vacation, a romantic break or a last-minute weekend getaway.
With so much to see and do in this amazing country, here’s a taster of what you can get up to during your stay.
There is no shortage of self-catering properties to rent in Spain, too. There’s an abundance of beautiful villas and apartments available here, so you can find your ideal holiday property rental in no time at all!
The regions of Spain include Andalucia, Aragon, Asturias, Balearic Islands, Basque Country, Canary Islands, Cantabria, Castilla-La Mancha, Castilla y Leon, Catalonia, Extremadura, Galicia, Madrid, Murcia, Navarra, La Rioja and Valencia, and each one offers so much to its visitors.
Within those regions, there are, of course, also some fantastic cities, towns and villages to check out. In fact, there are so many places that you’ll want to return to Spain, time and time again.
Some of the popular areas of Spain include Madrid, Seville, Barcelona, Bilbao, Alicante, Granada, Malaga, Valencia and San Sebastian, among others, of course.
Whether you’re looking to tour a busy city or laze on a beautiful sandy beach, Spain has the answer.
Madrid, the country’s capital, is brimming with museums and art, so be sure to check it out if you’re an art lover. There’s the Golden Triangle of Art, which is three museums – the Prado Museum, the Thyssen Bornemisza Museum and the Reina Sofia Museum. You can also see the Royal Palace of Madrid, tour Real Madrid’s famous football stadium or relax in one of the city’s parks or gardens.
Seville, Spain’s fourth largest city, is rich in history and a must see here is the amazing cathedral and its bell tower, the Giralda. Seville is also said to be the tapas capital of the world, so be sure to sample some delicious food and drink while you’re there.
The historic city of Barcelona is perfect for a short break. It has some lovely Gaudi architecture to gaze at and some interesting museums, too. It’s also an ideal location for a beach holiday, as it has 4.2km of sandy beaches situated just 10 minutes from the centre of the city!
Another popular visitor attraction is the Guggenheim Museum in the city of Bilbao, which is located in the Basque Country. It’s a must for art lovers. While you’re in Bilbao, take the opportunity to try some pintxos, which are like tapas.
Alicante, along the Costa Blanca, is a well known destination which has miles of sandy beaches to offer its visitors. Its mild climate is one reason why so many people come to visit. But if you want to do more than just lie on a beach all day, then the city of Alicante has no shortage of things to see and do. There’s the castle to visit, various parks to enjoy, museums to see and a wealth of restaurants in which to dine.
The city of Granada, meanwhile, boasts the stunning Alhambra Palace, that was once the home of the Arabic Sultans and is today a major tourist attraction. You can take a tour of the Alhambra and view the amazing architecture for yourself.
Malaga is another popular area with tourists. The city has a cathedral, a market, the Picasso Museum, numerous other museums, and the harbour and castle, too.
Malaga is just one of the many popular tourist destinations situated on the Costa del Sol. There’s also Marbella, Puerto Banús, Torremolinos, Benalmádena, Fuengirola, Mijas and more. The Costa del Sol is perfect if you’re after a beach holiday, as it has many excellent beaches to discover. The kids will love them, too.
Valencia is an ideal destination to relax and unwind. It has a lovely old town which has gardens, squares, museums and historic buildings to explore. Apparently, Valencia is where paella was invented, so, it’s not surprising that there’s no shortage of restaurants, cafes and tapas bars in this great city. Why not try some paella while you are there!
San Sebastian is another great beach holiday destination. The best beach here is said to be Playa de Concha, which is not only popular for sunbathing, but also for swimming and water sports.
Spain also has much more to offer those wanting a sports holiday. There’s plenty of golf available, as well as fishing, horse riding, scuba diving and other activities. Many people don’t realise that Spain has good skiing facilities, too. The ski resort Sierra Nevada, for example, is worth checking out.
The Canary Islands, which are part of Spain, are also popular holiday destinations. There are seven islands to discover – Gran Canaria, Tenerife, Lanzarote, La Palma, La Gomera, El Hierro and Fuerteventura. They are all worth a visit and if you’re looking for a Spanish holiday property rental, there’s no shortage of accommodation there.
Spain can offer so many different types of holiday to suit all ages and tastes. Whether you’re looking for art and culture, a sandy beach or a ski slope. Or if you’d rather get close to nature, visit a winery or sample some excellent cuisine, Spain has it all. What’s more, it boasts a lovely warm climate that makes it an attractive all-year-round destination – perfect for a self-catering holiday at Christmas or mid summer.
Go and discover Spain today!
Image taken on 2007-05-02 16:32:01 by BeneathOurFeet.
Many UK residents will dream of one day retiring in sunny Spain. After all, thousands of people have done so in the past, and thousands more are planning to do so in the future. Considering the many benefits of living in and buying property in Spain for your retirement – such as the lower cost of living, excellent local cuisine and fantastic climate – why wouldn’t you want to move to this beautiful country?
Britons in their 50s and 60s will have had first hand experience of the holiday package boom of the 1960s, with fond memories of these wonderful vacations. Return visits since this time will only have served to enhance the attraction of Spanish property. Additionally, the warm climate afforded by Spain’s most beautiful regions will provide much needed comfort to people of retirement age, who may no longer be able to withstand the inconveniences of typical British weather.
But don’t think of it as retirement: instead, let your move to Spain invigorate you to start a new life. Many people who set up a new home in Spain are stimulated by the exhilaration of re-locating their life, and take up new interests, rekindle dormant hobbies, make new friends and adopt a totally new lifestyle. Furthermore, the cost of living in Spain is much lower than in the UK; household bills and general purchases are less expensive, as are local community charges, road tax and fuel. This will enable people moving to Spain to enjoy their new life to the fullest, by making use of their extra income to indulge in a wider range of leisure activities.
Two factors that often concern people who are contemplating the move to Spain are the quality of services in the country and being able to grapple with the language. But there’s nothing to worry about: the quality of services in Spain has improved considerably over the last decade, with modern hospitals, an abundance of specialist doctors and high-quality education in schools. Moreover, Spanish is not a difficult language to learn and, depending on where in Spain you’re planning to move, many people will speak English as their second language – so communication won’t be as difficult as you might think.
What’s more, Spain’s infrastructure has undergone widespread development since the country joined the EU. This has vastly improved Spain’s road and rail networks, both within the country and in linking Spain’s residents to other parts of Europe. So if you choose to buy Spanish property, you’ll be able to access Europe’s other holiday hotspots easily and quickly.
With over 300 days of sunshine a year and an abundance of tempting local cuisine, the prospect of buying property in Spain couldn’t be more attractive. Prospective property buyers will be faced with choosing from smaller properties to much larger ones, especially if they’re looking for a home in Spain with extra space so that friends and family can holiday in comfort. So decide to retire in Spain: after all, when you can eat breakfast outside, avoid the inconveniences of multiple winter layers and take a daily dip in the sea, life is sure to seem much more pleasant.
If you are after unlimited sunshine, unlimited beautiful beaches, truly wonderful food, a wide choice of entertainment, and a wide choice of homes at affordable prices, then you will find Spain hard to resist. Although the vast majority of holiday makers (and residents) come to Spain to laze about on the beach, there’s much more to the country than the Costas and its islands .
Spain offers infinite variety with something for everyone, including terrific beaches for sun seekers and unbelievable scenery with tremendous views and wonderful mountain walks. For those who wish a more urban based life there are some of the most sophisticated cities to be found anywhere. For food lovers, you will find some of the best food to be found anywhere and wine to match.
To buy a home in Spain is not just to buy a dwelling but your chance to buy a lifestyle, and as a place for your holiday, second or retirement home, Spain is unrivalled, particularly if you’re seeking year-round sunshine.
So, why buy in Spain?
You can come up with a number of reasons why you would want to buy a home in Spain , although it’s important not to fool yourself or try and manufacture something that isn’t there with regards to what you can expect. Be consistent and realistic about what you can expect, ask fundamental question about what it is exactly that you want from a home in Spain? For example, is it a second home, holiday home or retirement dwelling that you wish to buy?
The south eastern Mediterranean coast of Spain has the highest percentage of retired persons in the world, when both Spaniards and foreigners are included. If you’re seeking a second home, what exactly will you want to use it for and how long will you wish to stay there? Do you plan to rent all or a portion of it to offset mortgage and operations costs? If that is the case, how essential to the overall plan is the property rental income? Is the decision to buy purely based on investment criteria? Do you plan to work or start a business in Spain? These are questions that need answers no matter where you purchase , but especially in Spain because of the variety of choices Spain has to offer.
Quite often potential buyers have a number of reasons for purchasing property in Spain. For example, many people buy a holiday home with an idea of living there permanently or semi-permanently after they retire. In a lot of cases the motivation is to start by purchasing a holiday home with the intention of retiring there later on. If this is the case, there are many more factors to take into account than if you were simply buying a holiday home that you will occupy for just a few weeks a year. If, on the other hand, you plan to work or start a business in Spain, you will be faced with a whole different set of criteria. You may be thinking of buying a home in Spain and commuting to another European country to work. More and more people are now doing that as they find that Spain has much more to offer nowadays.
Whatever the reasons for buying a home within Spain whether purely for residential or investment purposes, life in modern day Spain makes it such a difficult option to refuse.
Image taken on 2007-05-02 16:59:07 by BeneathOurFeet.
So why should your property business have a blog, and actually, just what is a blog?
Just about anyone who is anyone in the online community has a least one blog on the go. Blogging started back in 1994 but has gained enormous popularity as a means of online communication over the last 2 or 3 years. Blog is an abbreviation of the term “web log” and when the first blogs originally surfaced they were in the form of online diaries. Today, a new blog is born every single second, and at the last count (end of 2008), there were over 60 million live blogs.
There is an old saying that recounts that any sort of publicity is good publicity. Well that may or may not be true, but I think we all understand the spirit of the statement, and in this context, blogging can only be good for your property business.
Blogging has come to be one of the most popular tools for online social intercourse. People blog about anything and everything and it has got to the stage where if you have something you want to say, you put it on a blog.
Blogs can be read by anyone, but the most interesting point about them is that they empower anyone to add their own comments to the blog.
Most of the biggest, and certainly most of the aware property companies already have their own bloggs and pay people to update the blogs each day. They have recognized the importance of getting their name, or their website’s URL to be more specific, splashed around online.
All businesses seek advertising. The more they get, the more familiar people become with their company and what they do. Blogs can be an excellent form of cheap advertising. A blog is essentially a web page. It costs nothing to create and nothing to launch. A Blog in itself is not an out and out advert; it is statement and opinion about whatsoever subject the author wished to blog about. With the appropriate linking and publicity, other interested parties are drawn to the blog to read what it has to say, and perhaps to offer their own opinion or comments. It is also possible to publish adverts or links to other websites on blogs, and this is where the power to advertise can be realized.
Many property companies that already employ bloggers to write interesting pieces or comments about certain aspects of the property market stimulate interest and drive traffic to their websites. They might for example write a blog about the collapse of the property in market in Spain. As more people read this and add their comments and perhaps refer the blog to others, the more prominent the blog can become. It may even persuade investors to buy property in Spain for rock bottom prices knowing that in time the market will recover. The more links and traffic a site has, the more it will get noticed by the search engine spiders, and this inevitably raises the websites rankings. The higher the ranking, the higher a particular website will feature on search engine reports.
Blogging is also a great way of networking. In a business like real estate it is so important to be able keep up with any new trends or shifts in the various market sectors. Blogging facilitates networking and has fast become the way to exchange views and keep up to speed with what it happening elsewhere.
Any property company that does not avail itself of the advantages of blogging is disadvantaging itself in a business arena that thrives itself on the exchange of information.
If you crave for endless amounts of sunshine, miles of glorious sandy beaches , truly wonderful food , a wide choice of entertainment, and a wide choice of homes at affordable prices , then you will find Spain hard to resist . Although the vast majority of tourists (and residents) come to Spain to laze about on the beach, there’s much more to the country than the Coastal resorts and island entertainment.
Spain offers amazing variety that covers most options for everyone, including terrific beaches for sun seekers and unbelievable scenery with tremendous views and wonderful mountain walks. For those who wish a more urban based life there are some of the most sophisticated cities to be found anywhere. For food lovers, you will find some of the best food to be found anywhere and wine to match.
To buy a home in Spain is not just to buy a dwelling but your chance to buy a lifestyle, and as a place for your holiday, second or retirement home, Spain is unrivalled, particularly if you’re seeking year-round sunshine.
Why would you want to purchase a home in Spain?
You can come up with a number of reasons why you would want to buy a home in Spain , although it’s important not to fool yourself or try and manufacture something that isn’t there with regards to what you can expect. Get the basics right from the outset on what your expectations are , ask fundamental question about what it is exactly that you want from a home in Spain? For example, are you seeking a holiday or a retirement home?
The south eastern Mediterranean coast of Spain has the highest percentage of retired persons in the world, when both Spaniards and foreigners are included. If you’re seeking a second home, will it be mainly used for long weekends or for lengthier stays? Is all or part of your plans, the idea that you are buying this for investment and rental purposes? If that is the case, how essential to the overall plan is the property rental income? Is the decision to buy purely based on investment criteria? Do you plan to work or start a business in Spain? These are questions that need answers no matter where you purchase , but especially in Spain because of the variety of choices Spain has to offer.
Quite often potential buyers have a number of reasons for purchasing property in Spain. For example, many people buy a holiday home with an idea of living there permanently or semi-permanently after they retire. In a lot of cases the motivation is to start by purchasing a holiday home with the intention of retiring there later on. If this is indeed the case then there a whole number of factors that need to be taken into consideration at the outset than you would need to consider if the motivation was to occupy somewhere just for say a few weeks every year. Conversely if the plan is to live and work within Spain then there are an entirely different set of criteria that need to be looked at. Part of the motivation might be to live within Spain yet commute to other European locations on a regular basis as transport (especially external links) is so straightforward to come by. Many people are doing just that because Spain has a lot to offer.
Whatever the reasons for buying a home within Spain whether purely for residential or investment purposes, life in modern day Spain makes it such a difficult option to refuse.
Part 2. The Free Property Inspection Trips to Spain – Warts n’ All.
FRESH OFF THE PLANE.
I have written this section of the article with the assistance of personal experience in the industry, having personally undertaken an inspection tour, family and friends who hae toured and most importantly experienced sales reps who still work in the industry, so they have no axe to grind but perhaps their conscience got the better of them. The only remuneration they received was a couple of cafe con leche’s each. The surprising thing was that I had arranged to meet two reps but when word spread half a dozen arrived with offer from many others.
Your tour should proceed along these lines. Show homes are close on Saturday afternoons and all day Sunday and flights are more expensive over the weekend so most tours tend to be during the midweek. Tour duration is normally 5 days 4 nights. For the purpose of this article I have formatted a Monday to Friday tour.
MONDAY:
A couple of years ago a trip to the arrival lounge at Alicante or Murcia airport would have seen you rubbing shoulders with dozens of agents sales reps / salespeople / property consultants / tours guides ( I will call them reps from now on) all standing there with their clipboards with their clients names printed on them, often looking nervously as passengers came through the sliding doors. Similarly a trip down the coast road from the airport you would literally pass dozens of agents cars all brightly liveried and each company with its own colour cars. The credit crunch has killed off the numbers but made the agents need to extract every last euro from clients almost an art.
Your rep will great you with a big smile and engage you in small talk as they walk you back to the car. The reps should also take the luggage off you or at least the wife. During the journey back to the hotel it is taboo for the rep to talk about property for fear of the client feeling under pressure. What the rep is doing here is selling themselves, after all who would buy off somebody that they either did not like or did not trust? Your rep is sticking strictly to step one of the seven steps. The holy gospel of the rep which is drilled into them from day one. The steps are as follows and I will refer to the as we progress. I will shortly be writing an article solely covering the seven steps in much greater detail.
1. SELL YOURSELF – Make yourself likeable to your clients
2. SELL THE COMPANY – We are established, trustworthy, large, family run, UK based….
3. SELL THE AREA – Sell the lifestyle, pace of life, cost of living, health, beaches ……..
4. SELL THE PROPERTY – Once sold on the lifestyle find the property within budget.
5. FINANCE – Sort out loans, mortgages, affordability etc.
6. CONTRACT – Complete a property purchase contract and get €3000 deposit.
7. CONSOLIDATION – Introduce to solicitors, open bank accounts and look after them.
When you rep gets you to the hotel, they will jump out of the car and open the door for you, they will get your bags and check you into a very swish 4 or 5 star hotel on the beach with stunning views (see # 3). Once they have checked you in they will take you up to the room, open the door and take you in. You will often find that the curtains will be closed in the room. This is an arrangement that the agent will have with the hotel. This enables the rep to do the great reveal. They will walk to the window and pull the curtains back with gusto revealing a beautiful view of the beautiful blue Mediterranean Sea. Having just left a grey, miserable, cold, wet and windy UK, this reveal makes the client feel that they have found heaven.
Most clients arrive late afternoon, so the rep will leave you for a couple of hours to rest and come and collect you for dinner (the tour will include all meals). The rep will still not be speaking about property, they will, still be selling themselves and the business. They will tell you about how they came to live in Spain, how great it is, how their kids love it…… this is undoubtedly true as I am willing to testify but it is all part of the sales process. The rep will also start telling you how great the company is and how good they are to work for and how well they treat their staff. The truth is that they are all non contract, commission only sales people who are in fear of their jobs from tour to tour because if they do not sell and hit targets they are out! The rep will also outline the itinerary whilst you are with them:
Monday: Arrive, settle in and go for dinner.
Tuesday: Pre tour meeting and area tour, go for dinner.
Wednesday: Look for properties in areas you have expressed an interest in.
Thursday: Continue search, or if purchasing complete contracts, payments etc.
Friday: Continue search or if purchased, consolidate and back to airport.
Following your nice evening meal you will be dropped off at the hotel and arrangements made to meet you in the hotel reception at 9:30am the following morning. As they leave the rep will be on the phone to their manager telling them what they think of you and the likelihood of you purchasing. You will be graded as red, amber or green or on a scale of 1 to 10 as a prospect with red or 1 being no chance. All clients start as amber or a 5 on the scale.
TUESDAY.
A good hour or so before the rep collects you on Tuesday they will have a breakfast meeting with their manager where they will discuss in great detail their impression of you. The manager will produce all the paperwork that they have on you. This will be notes and transcripts of conversations that you have had with the companies telesales staff, or the home visit rep or even with the manager when they called to confirm your attendance a couple of days ago. All the questions that you have been asked no matter how innocent have the intention of garnering as much information as possible. This meeting that the rep ha with their manager will determine the course of action that they will be taking with you over the next few days!
The rep will come and collect you on time. They will be in their uniform, light pants, either white or blue shirt/blouse, brown shoes, sunglasses and immaculately clean company car (the cars are inspected each day and reps fined €50 for dirty cars). Your rep will then take you to a lovely café by the beach, or on a golf course or with fantastic views. This helps sell the lifestyle, but the choice of café is determined following your conversation the previous evening when they gleaned the information out of you to make this choice.
The purpose of the meeting is to determine what you are looking for i.e. holiday home, relocation, investment or business, your budget and your preferred location. The rep already has this information as this information has already been obtained from you when you arranged the trip in the first place. The one thing that the rep will do is promise never to show you properties above your budget, they will site affordability issues however the truth is that people who over extend when in Spain are 4 times more likely to cancel when they get back to the UK.
Meeting over you will jump in the car. One thing to note here is that the rep will always have a cool box or paperwork on the seat behind them. This means that the clients will sit in the passenger seat and the seat behind. This stop them being able to make eye contact with each other, communicate without the rep hearing and the rep will be able to see the client in the rear view mirror.
The day will be spent completing an extensive tour from Alicante in the North to Cartegena in the south and up to 50km inland. You will visit town, villages, beaches, golf courses, mountains, you name it they will cover it. Anything or place you express an interest in will be noted for use later. If you like a particular village or beach, they will stop for a look around or a coffee. Although you do not know it you will be following a pre determined route aimed at showing the area in its best possible light.
Whenever you do stop the rep will be glued to your side at all times. They do not want you talking to the natives because they may tell you something that you do not want to hear (i.e. how much commission the agents charge/make). The rep will always seat you away from other people, never at a café with free papers (other agents advertise in them) and never near an estate agent window because invariably they could have the same properties for sale for considerably less money! (most properties for sale are on with many agents).
Following completion of your area tour you are returned back to the hotel at 6pm, some 8 ½ hours after you were picked up and informed that the next couple of hours are your own and that the rep will pick you up at 8pm for dinner. As a parting shot the rep will warn you about “bar stool Johnny’s”. They will tell you to be suspect of anyone who approaches them in the hotel bar or foyer as they could be a con merchant who will know that they are on an inspection trip and will coerce them out of thousands of euros. There may be a modicum of truth in this, however its main reason is to stop clients talking to each other and comparing experiences. One rotten apple can spoil a barrel….. You will be picked up at 8pm and taken to a nice restaurant for a three course meal and wine and taken back to the hotel at 10:30pm. You have been with you rep for 13 hours.
WEDNESDAY.
Following the extensive and tiring area tour you will be hoping for an easier day today. Your rep will collect you again at 9am fresh from a debrief with their manager where the plan of attack will have been drawn up. Today is all about property, after all, this is the third day you have been in Spain and you have not seen any property yet.
There has been a lot of thought put into the art of showing properties. The rep will have listened to your preferences and listened to your opinions when on the area tour. You general chit chat will have been noted and the answer to innocent sounding questions during dinner will have been noted, analyzed and actioned.
When you arrive at a property you will be brought in on a route that shows the property and area to its best. The show home will be immaculate; it will be on a nice big plot or have great views and will invariably be the most expensive plot on the site. The show home will have been dressed by a designer. Your rep will now take you round room by room, telling you what is included and what is not, what the payment structure for this particular developer is
You will never be shown the best property first. The first property will often be chosen because it does not match many of your requirements. You will be asked for your comments regarding, size, location, views, rooms etc and asked to score the property on a whole out of ten and the area out of ten. If you score the property highly and area poorly we need to look at similar properties in a different area. If you score the area highly and property poorly, we need to look for different properties in the same area.
The rep should note your thoughts, comments and scores and move on to the next property based on your requirements.
Amazingly the reps I spoke to stated that if somebody was genuinely interested in purchasing that they only ever showed 3 or 4 properties before they found the perfect place.
Do not be surprised if at some point during this day that the reps manager accidentally bumps into you either in a show home or at a café somewhere (those furtive phone calls the rep makes or receives when they slope off out of earshot are the management gauging the progress of the tour. If you hear the rep saying amber or green you might know what they are talking about now). The manager is there to check on how well the tour is going, check up on the rep and try and point the clients in a new direction should they need to, or to reveal a deal that can be done or a special offer that has only just become available.
The pressure will be really on the rep towards the end of the day as you should have seen a property that meets all your requirements by now. The pressure exerted on the rep will be passed down to you in a more subtle way in the form of more direct or leading questions.
You will be dropped off again at 6pm and collected at 8pm for dinner. The conversation at dinner will be a lot more focused. You may also find that on this evening all the reps and their clients eat in the same restaurant, often taking it over. The reps are allowed to bring their partners to this meal. This is all part of the sales process as the partner has been thoroughly briefed on what to say. The reps manager and partner will also be present, so the sales process continues until 10pm. You will be dropped off at the hotel at 10:30pm with another 13 hour day under your belt.
THURSDAY.
By this point in the tour, if you have not purchased the chances of you doing so are minimal. Not only will you be feeling the effects of the long days, but so will the rep as their working day is on average 15 hours a day. Be prepared for a battle of wills.
Yours reps phone will be a lot busier today as they are pressured from above to get a sale. You will almost certainly call into the office to have a look around, with the real intention of putting some pressure on from the manager, finance person, company owner etc. This pressure will never be too excessive as this could be off-putting, but it will be pressure none the less. “We have found you the property within your budget in an area that you loved that meet all your criteria…… its what you asked us to find and we have, so lets do the paperwork!” The rep will pull out the property scoring sheets with you favourable comments and score on the top property. You will be told that if you do not buy now then you never will. Your “bottle” will be questioned and you will be asked why you bothered coming out if you had no intention of purchasing I the first place.
This is the make or break part of the tour. The pressure to purchase will be considerable but not overbearing, more subtle than high pressure.
You will find yourself looking at properties that had previously been rules out because of comments made in other properties. If you comment in one property that the kitchen is too small, the rep will then rule out taking you to dozens of properties that have small kitchen and will only take you to properties that have bigger kitchens.
The rep will keep going because they are paid on a commission only basis and have nothing to lose. As a self employed, commission only sales person, if you do not buy, they will not be getting paid for working some 60 hours and they could be one step closer to getting fired, especially if the sales manager thought you were a good purchasing prospect. In Spain if you are not on a contract you have to pay approximately €250 per month to the tax office to cover social security as well as €50 towards your accountant. Even if they do not work or earn no money one month they still have to pay out €300. Their company will say that this keeps them lean and eager. The reps will say that it leads to unnecessary pressure and often hardship.
With the realisation that there is no prospect of a sale, most reps will give up come the end of the day. You will find that you will be dropped off at the hotel at 4pm, the rep will offer you the chance of going for a meal on your own (at your own expense) and you will be given the opportunity of a later collection on the final day.
The meal on this last evening if taken will be a more casual affair as the rep is resigned to a “no sale” tour. The meal will be taken earlier and finished quickly. The rep out of spite will often take you to a restaurant that you have expressed that you do not like. If you don’t like Chinese food guess were you will be eating come the last evening if you have not purchased.
FRIDAY.
If you have purchased you will have spent Thursday completing paperwork and contracts in the office. On the Friday the rep will have you out of bed at 5am and standing outside the local town hall in a queue to get your NIE number (needed for purchase). You will be taken to a bank to open a bank account and introduced to a solicitor. If you want the solicitor to have power of attorney you will need to go to the notaries office as well.
As a word of caution I would always advise you to seek out your own solicitor rather than one suggested by your agent. Your solicitor should be working exclusively for you and some agents have far to a cosy relationship with their solicitors. Just check out some of the internet forums for details.
If you have not purchased, this will be a more relaxed day. You will have to check out of the hotel by 11am but the hotel or rep will take your cases. You will need to fill in an end of tour report where you can comment on the rep, company and tour. You will have a little time to sunbathe , go shopping, go for a walk. The chances are that you will be dropped off at the airport a good 3 hours before your flight and your reps car will disappear in a cloud of dust ready for the next clients.
IN SUMMARY.
Taking everything into account would I recommend partaking in an inspection tour?
The case for yes:
If you are looking for a new or off plan or key ready property, the prices are set by the builder not the agent, so you will be paying the best price for the property. Despite the sales tactics, the reps in general have a fantastic knowledge of the area, builders and developments and despite what you may think, they are chosen for their personality more than sales skills. The agents can use their size and power in your favour and you do get free flights, accommodation and use of car and tour guide. You will cover more area and see more in one day with a good rep than you would do in a week on your own. If you do purchase you are actually paying for your free tour out of the agents commission. It’s a great way to learn the area and see property at their expense, however please remember that your rep will not earn a penny if you do not buy.
The case for no:
You only get to see the side of Spain that the rep wants to show you. You are never on your own and are always being questioned as to your opinions. If you are considering a resale property then you will have to pay the agents fees not the seller. Agents can charge up to 20% commission. One a villa valued at €200,000 the agent will put it on the market for €240,000 . An agent can make €20,000 on a small apartment. If you have an idea of the area or what you want and the sort of property you are after you can save a fortune doing it your self.
There is an alternative. There are now companies who offer the best of both worlds. They are independent of any builder, promoter or agents. You pay for your flights and accommodation and meals. They pick you up and take you out looking at areas and properties and charge you a day rate. The late afternoons and evenings are yours. People come out for 7 days, spend 3 looking at properties and the rest of the time on the beach. Because they are independent they have no loyalty other than to you and could save you thousands. In these times of hardship it really is the best solution to a problem you never even knew existed…. Until now.
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How about Las Vegas next time?
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