Thousands hand back their villa keys as Spain's economy teeters - Daily mail

[Vortex Wake]

Fleeing the Costa catastrophe: Thousands hand back their villa keys as Spain's economy teeters

Dennis and Christina Powell have always loved Spain. Over the years they had gone there on holiday many times.

They love its people, culture and climate so much that in 1999, after retirement, they decided to buy a three-bedroom apartment in Torrevieja on the Costa Blanca. It cost them £36,000.

For nine years they escaped the British winter and headed off to their Spanish retreat in the sun. But in 2008, with the international banking crisis, everything changed.

Suddenly their UK savings and pensions bought a third less after the pound plunged against the euro.

And the property boom came to an end, leaving parts of Spain desolate. The couple put their once much-loved property on the market — where it remained for more than three years.

They finally sold in February. In that time, property prices slumped by almost 70 per cent — eating into what equity they had built up. But despite the struggle and the money they have already surrendered, Mr Powell thinks they might have got out just in the nick of time.

HOW TO PROTECT YOURSELF WHEN BUYING PROPERTY IN SPAIN
Get all documents translated.
If you are given something to sign, make sure you are given a 14-day cooling off period.
Take the documents home to the UK and speak to a lawyer and financial adviser over here, rather than in Spain.
Make sure the lawyer is independent and not involved in the sale in any way.
Do not use a lawyer recommended by the seller.
If YOU are buying a repossessed property, find out what happened.
If you are borrowing money, go to a reputable bank. The bank manager will want to be sure the deal is sound - and this adds another layer of checks and protection.

‘We had some wonderful times, but our holidays were getting too expensive and I didn’t want to have a home where the property market was in trouble and might take decades to recover,’ says Dennis, 73, a retired airline clerk from Hayes, Middlesex.

Thousands of British expats and second-home owners are fleeing Spain as its economy teeters.

Last week, 15 Spanish banks, and Santander UK, had their credit rating downgraded by agency Moody’s.

Bankia, Spain’s fourth largest bank, became 45 per cent owned by the Spanish government.



Read more: http://www.dailymail.co.uk/money/mortgageshome/article-2148335/Fleeing-Costa-catastrophe-Thousands-hand-villa-keys-Spains-economy-teeters.html#ixzz1vg9Z033o

[Simon-M]

It's important to understand that handing the keys back in Spain is not like handing the keys back in the UK. If the bank sells the property at a loss (if they sell it at all even) you will still be responsible for what is left on the mortgage.

[Vortex Wake]

And you will be liable for unpaid community fees.

[delderek]

It's important to understand that handing the keys back in Spain is not like handing the keys back in the UK. If the bank sells the property at a loss (if they sell it at all even) you will still be responsible for what is left on the mortgage.

In most cases It's actually the same as that in the UK

[TOTO 99]

Given the sensational headline, in the example used, the couple didn't "hand back the keys" at all. They sold up and didn't make as much as they'd have liked. Surely that's the same everywhere?

[9PLUS]

Old Dennis and Christina Powell cases doesn't seem to add up to me it's all about how bad Spain is yet it's really about how the UK pound has weakened?



They love its people, culture and climate so much that in 1999, after retirement, they decided to buy a three-bedroom apartment in Torrevieja on the Costa Blanca. It cost them £36,000.


So there was no mortgage being retired people as they were. So all the other stuff in this thread from the Dailycrapmail has no relevence to Dennis and Christina Powell

Confusing one thing with another to make a sensationalistic story.

[Simon-M]

I didn’t want to have a home where the property market was in trouble and might take decades to recover

So that leaves him with a corrugated iron shack in Mogadishu :)

[bonitatime]

They bought a 3 bed house for 36 thousand and were forced to sell for 70% less
I find this fairly unreal



And I an sure there is no 10 day cooling off period on your escritura signing
This article is not very accurate

[9PLUS]

Drivel from the tabloids = Dailycrapmail

[Balcony]

This is the text of a short piece on AOL's newsfeed:

Spain's pain is getting worse, particularly for expat British property owners trying to flog their overseas home. A combination of a crashed Spanish housing market - values have slumped by up to 70% on the Med coast - the drastic change in exchange rates and worry over Spain's economy is seeing many attempt to sell up or re-jig mortgage terms.

But there's a big new sting in the tail for some.

Spanish stinger
Last week more than 12 Spanish banks were thumped with a new Moody's credit downgrade. These banks are a crucial component of the Spanish housing crisis because they have massive exposure to the housing market - around €170bn. Most are now trying to recover their debts.

However Spanish property lawyer Jonathan Ogley told AOL Money that ex-pat British property owners will need to keep a sharp eye on the small print, especially if they're re-negotiating Spanish mortgage terms.

"They [the Spanish banks] will charge a commission fee and associated costs set out in the original terms and conditions for any change to the mortgage. Often those costs can be as much as four or five thousand euros."

"Everything," he adds, "has to be notarised and re-registered at the Land Registry. It's almost as long-winded as taking out as taking out a new mortgage. Almost, but not quite. This is something not always made clear by a Spanish bank."


Alternatives?
So, even more financial pain for some. For those wanting to get out of Spain completely or who increasingly feel stuck, some hard decisions will have to be made - including kissing goodbye to much of the cash you may have invested in your property, warns Mr Ogley.

The other option, Mr Ogley suggests, is to approach your mortgage provider and ask if they will agree to a Dación en Pago - basically a voluntary return of the property in exchange for writing off the debt.

But Mr. Ogley warns: "Merely physically handing the keys back doesn't achieve anything - don't do it."

The Spanish authorities have recognised the severity and scale of the problem for many Brits though. "In January 2012 a code of best practice was introduced which sadly is voluntary," says Ogley. "But it does mean that banks who have signed up are obliged in certain circumstances to try and find a resolution to the problem."

[slodgedad]

This thread absolutely confuses me..(3 bed apartment, 36,000, had to hand keys back).. Gotta be some facts wrong here somewhere.

[lapalma]

Although I would not want anyone to loose out in any property that they owned in mainland Spain as well as the Canary Islands I feel that it may become a buyers market.The EU as a whole is under major problems including the UK.I would hope that things improve in the near future otherwise the EU will not survive.

[slodgedad]

Although I would not want anyone to loose out in any property that they owned in mainland Spain as well as the Canary Islands I feel that it may become a buyers market.The EU as a whole is under major problems including the UK.I would hope that things improve in the near future otherwise the EU will not survive.

I realise and know, from personal experience, that it is a buyers market but how can they possibly be in trouble with a 3 bed that cost 36.000?

[lapalma]

I realise and know, from personal experience, that it is a buyers market but how can they possibly be in trouble with a 3 bed that cost 36.000?


Many thank's slodgedad for your reply,now tell me where I can buy an apartment for 36,000 as I have negative replys from many estate agents in Spain.I wish no evil thoughts but if I could buy at that price then I would be out in Tenerife or mainland Spain,kindest regards.

[s1monsg]

The 70% reduction is, in my opinion, a reduction in what they priced it for 3 years earlier. I am certain it's not a 70% drop on the €36.000 they bought it for originally. Had they realised or thought about it, they should have priced it less than others in the same complex and sold it quicker and not waited the 3 years for a buyer to come along. It's all about headlines. As someone else pointed out, they didn't even hand the keys back, they just sold it for less than the inflated price they originally wanted for it. They still sold it and didn't hand anything back. Oh, and the great advice about getting a UK lawyer and financial adviser involved doesn't have anything to do with their case and in most cases a UK lawyer and financial adviser wouldn't have much knowledge about anything here anyway.

[slodgedad]

The 70% reduction is, in my opinion, a reduction in what they priced it for 3 years earlier. I am certain it's not a 70% drop on the €36.000 they bought it for originally. Had they realised or thought about it, they should have priced it less than others in the same complex and sold it quicker and not waited the 3 years for a buyer to come along. It's all about headlines. As someone else pointed out, they didn't even hand the keys back, they just sold it for less than the inflated price they originally wanted for it. They still sold it and didn't hand anything back. Oh, and the great advice about getting a UK lawyer and financial adviser involved doesn't have anything to do with their case and in most cases a UK lawyer and financial adviser wouldn't have much knowledge about anything here anyway.

Exactly. It is sensationalism.

If you need an example you'd think they'd pick on someone that actually lost money and not someone who didn't make much. (Even though it was a paid for retirement home)

[Vivy]

The Spanish authorities have recognised the severity and scale of the problem for many Brits though. "In January 2012 a code of best practice was introduced which sadly is voluntary," says Ogley. "But it does mean that banks who have signed up are obliged in certain circumstances to try and find a resolution to the problem."

Anyone know anyway of finding out which banks signed up to this?

[9PLUS]

Dailycrapmail editorial dept


Today boys & girls we are going to pick 200 random words from a hat and see what we can come up with...

[CIM]

That is a very poor article!
Bought for £36,000 in ´99 but doesn't actually say what they sold for - so wheres that part of the story and what is the ultimate conclusion?

So far as their "tips" for buying- what a joke! Sounds like this was written on a Friday afternoon and the journo was desperate to get to the pub!

Really bad journalism...

[TenerifePool]

Many thank's slodgedad for your reply,now tell me where I can buy an apartment for 36,000 as I have negative replys from many estate agents in Spain.I wish no evil thoughts but if I could buy at that price then I would be out in Tenerife or mainland Spain,kindest regards.

Try
www.masbaratosquelosbancos.com
or
www.subastamoscasas.com
There are other sites too. The Estate Agents won't tell you about the bargains. I know of a couple who buy from these sites then advertise them as "Property of The Week" at "bargain" prices.

[golf birdie]

Try
www.masbaratosquelosbancos.com
or
www.subastamoscasas.com
There are other sites too. The Estate Agents won't tell you about the bargains. I know of a couple who buy from these sites then advertise them as "Property of The Week" at "bargain" prices.

there are areas in Tenerife as well as other places where some property at 36k is over valued, some in fact are worthless. Out of that list the only one I would even consider is in La Laguna due to the possible rental return from students. Anyone hoping for a nice 2 bed in Los Cristianos on a nice complex for 36k will IMO, have a very, very long wait.