Want to Self-Build in Spain? The Time is Now.
As always in investment, timing is everything. Whilst many would-be second home owners are eyeing the Spanish property market from the sidelines on the assumption, rightly or wrongly, that prices will slip down even further on resale property, timing could not be better for self-build. MD of Carrington Estates, Paul Rossiter, explains…
“If you’re keen on the idea of self-build, now is an absolutely prime time to get involved as most building contractors have little work due to the major slowdown in the building sector so are prepared to work for a minimum profit just to be able to keep the workforce on. Subsequently labour costs are reduced. But it doesn’t stop there; it is also possible to negotiate reduced prices for interior design, landscaping, kitchens, domotics and so on.”
Paul continues, “Building-out is the only way to get value from your land purchase right now. Banks are not currently lending on land so plot sales are slow, but several lenders will still loan 100% of build cost. It makes sense to build during a period of negative growth and then see some serious capital appreciation when the market returns as predicted in 2010. Although you may not have to wait that long as the top end of the southern Spanish property market is in fact holding up and sensibly priced good quality new villas in the best locations are still selling well.”
Christopher Clover, Managing Director of long-established Marbella real estate agency Panorama concurs that higher priced properties are very much in demand, he is quoted as saying “It is worth noting that properties between the €800,000/€1,000,000 to the multiple million range, which are located in the more consolidated areas closer to services, etc have been maintaining their value extremely well.
They are still in good demand by the classic, end-user client and continue increasing, albeit at normal levels, but sometimes even reaching record prices. Along Marbella's Golden Mile, the coastal strip where properties are routinely priced at more than €10 million, homes are still selling”, Chris continued, “The market on the coast is not connected to the market in Spain in general. We're totally an international marketplace here.”
“Top product is still selling,” said Julia Serrano Rituerto, head of residential sales for the Spanish office of the real estate company Cushman-Wakefield. “Clearly there is demand.” He adds that British investors, the traditional mainstay of the market, may be scarce, but millionaires from Russia and the Middle East are still seeking top properties.
James Stewart who heads up the Savills office on the Costa del Sol said: ‘‘There’s a softening across the board but deals are still being done at the upper end.” Whilst oft-quoted Mark Stucklin of consultancy Spanish Property Insight commented, “Top quality always holds its value because it is in limited supply. You'll pay more but you'll get better value for money ultimately. Don't just look for low prices, because that doesn't mean it's a bargain. It's just low quality.” He adds, “There's a clear distinction between prime and non-prime locations in Spain. In some areas that are popular among wealthy Spanish buyers, supply is limited because land is limited and buyers aren't over-leveraged so there is no financial distress,” says Mark. He cites as examples prime beachfront areas of Marbella, prestigious resorts such as La Zagaleta in Marbella and Sotogrande on the Costa del Sol”
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For further information contact Carrington Estates on 00 34 952 810 868, UK Local Rate 0845 094 1168, email