CRISIS – YOU ARE NOT KIDDING!

A 976 word Blog for Xpat.com

By

Nick Snelling

CRISIS – YOU ARE NOT KIDDING!

Of course, one of the devastating points of impact for us all during the present crisis is the appalling difficulty of selling property in Spain.  I mean that in terms of individuals rather than from the viewpoint of an industry ‘professional’.

In truth, the Spanish property market must be approaching a state at which it is the worst in living memory.  Nonetheless, I very much doubt that we have yet hit the bottom.  If you look at the facts, they are pretty devastating.

No-one knows for sure, of course, but there are probably some 2 – 2 1/2 million properties currently for sale in Spain (including some 1 million new builds).  Prices are still dropping, sterling has collapsed against the Euro, the lucrative North European market for buyers is in recession and Spain is in terrible trouble - whatever Zapatero claims.  Both internal and external tourism is likely to be significantly less this year and unemployment is predicted to go to 16% and, in reality, may reach 20% before the year end.

By anyone’s standards this is a terrible time with little obvious short term future hope.  This is not entirely surprising given that the very government figures who have colluded in the crisis in the UK and Spain are still in charge – and quite clearly have absolutely no idea of what to do.

So, how long is the crisis going to last?  That is the critical question if you are trying to sell your property.  Of course, no-one knows and any prediction is likely to be little more than an educated guess.  That said, I tend to think that to use the last recession in the UK is a useful guideline particularly as, at the time, many people considered it the worst economic crisis since the 1930s.

As most of us can remember, it took around 9 years for UK property prices in the 90s to recover their previous highs - with little real property price movement for the first five years of the recession.  This would indicate that if the present crisis is no worse than the 90s crash (and I believe it to be much worse) then it will take nearly a decade for property prices in Spain to recover their highs with the next five years seeing prices in the doldrums.

Hopefully, for all parties (me included!) I am dramatically wrong in my assessment of the recovery time for Spanish property.  However, if I am even vaguely right then it means that, as a seller, now you need everything on your side to successfully sell your home and move on with your life.  A devastating thought.

It was thinking on this appalling conundrum in October that drove me to write a book that has just been published  and that is now available on Amazon etc. entitled: ‘How to Sell your Spanish Property in a Crisis‘.  Oddly enough, for an agent, I was wondering what I would do if I wanted to sell my own property (which I do not, incidentally!).  I came to the conclusion that I would do just about everything that clients of mine do not.

In fact, the more I considered Spanish property sellers the more it struck me that most sellers are incredibly passive – despite the massive stakes and the sometimes huge commissions payable to agents.  At best, most people just buy a Se Vende board and call in the estate agents.  And then...well... they wait...for buyers to arrive – which in a falling market is unlikely and desperately depressing.

Is this what an industry professional does when he goes to sell his own home?  Absolutely not!  He knows how to be constantly and effectively proactive: how to prepare his house for sale, how to exploit the full range of extensive marketing tools available, how to deal with fellow professionals, the way to negotiate with potential buyers, the legal hurdles and how to close a sale and keep its momentum going all the way to the signing of the Escritura.  In other words, he has the ‘edge’.

The trouble is that few agents will be singularly and consistently proactive with your property in Spain  – let alone spend money on its continual promotion.  That only occurs on a sole agency deal (an unwise move for most sellers) - and even then the truth is that always you have more ‘tools’ at your disposal than any agent.  If only you know what they are and how to use them.

So, what have I done?  With my highly qualified industry contributors, I have tried to provide sellers with the ‘inside’ track on how to sell.  Concise and bulletpointed, my book seeks to empower sellers so that they can use every possible tool available to sell their property.  Because, in this Spanish property market, for the forseeable future you need to be able to work every angle there is if you are to have any chance of selling your property.  As always, the vital tips and workable ‘secrets’’ of any value only come from inside the industry from people with genuine practical experience of selling property in Spain.  It is these that count and that can make the critical difference between selling – or not. 

For those interested, I have finished my book with an analysis of the Spanish property market ‘The Story: Boom and Bust’.  It makes strong reading (although I say it myself!) as from it you can clearly see that the facts indicating that a property crash were clearly on the cards years ago. 

What was our government doing?  What was it thinking of?  The data was there (much of it produced by the INE – the Spanish statistics institute) and yet no-one took any notice!  As a consequence, the gross negligence that has led to the property crash is going to lead to potentially years of appalling hardship.  It makes me feel sick to my heart...

Copyright Nick Snelling (www.nicholassnelling.com) author of three books on Spain including ‘How to Move Safely to Spain’ (www.movesafelytospain.com)

ENDS