Baltimore, MD (PRWEB) June 29, 2012
A move by Spanish banks to offload the build-up of foreclosed properties on their books is triggering a massive decline in real estate prices, researchers at InternationalLiving.com have found.
Spain’s real estate market saw a flurry of building activity prompted by rising real estate prices and property speculation up until 2007, when transactions came to a near standstill.
As a result, Spain now has an estimated two million units worth of excess residential property.
Spanish banks had been slow to offload the properties, which came into their possession when struggling developers proved unable to repay loans.
However, the banks now need an estimated $77.4 billion to stay afloat. The Spanish government has officially requested a bank bailout from the European Union. And so the financial institutions are now attempting to liquidate as much of their inventory as possible.
The move is good news for overseas buyers who can now secure Spanish real estate for a fraction of its peak prices.
“Until now, there has been no genuine effort to sell this inventory,” explained InternationalLiving.com’s real estate contributor Ronan McMahon. “But the banks are finally doing deals.”
McMahon added that banks are offering up to 95% financing on their properties.
He continued, “Financing is available direct from the banks that have foreclosed on the properties. Put simply, they are trying to turn large, non-performing loans they have made to developers into many smaller, performing loans to individual buyers.”
While much of the country’s cut-price real estate is located around the tourist areas of the Costas, there are some major discounts available in more attractive areas.
A series of newly completed condos in a historic area of Granada, for instance – hailed as Spain’s most beautiful city – have just been offered by one Spanish bank with a price tag starting from less than $100,000 per unit.
The 800-square-foot units are within walking distance of the city’s Old Town and come with 95% financing available for both domestic and overseas buyers.
“Monthly repayments on these units could be as low as $600 per month,” said McMahon.
To read InternationalLiving.com’s full article on the Spanish crisis and the real estate opportunities it has created, see here: "Spain's Real Estate Market: Up to 50% Off Property Prices".
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