Spanish Banks To Slash Property In Spain Prices In 2011?
Spanish Banks To Slash Property In Spain Prices In 2011
?With the news that Banks in Spain now recognise that they have no alternative but to reduce Spain property prices further if they are going to have any chance of attracting more buyers. This has been very obvious for some time with discounted properties from a developer being in some cases a third less than a similar bank repossession on the same development. In the past, Spanish banks have generally refrained from slashing property prices during a market downturn and have always tried to hold out to get 100% of there debt paid back. But the current collapse in the Spanish property market has prompted the need for greater action, The Spanish property market has endured a torrid time over the past three years. House prices have plummeted, as a consequence of a chronic oversupply of homes in Spain mainly in the Costas. However interestingly in places such as Mallorca where there isn't an oversupply prices actually rose in 2010. The Spanish banks now own tens of thousands of homes in Spain. But in an attempt to reduce their property assets, many banks reportedly plan to lower home values further in the hope of increasing sells and avoiding a Japanese-style slump that continues for years, according to Spanish property firm Idealista. More banks may also start to offer up to 100 per cent loan-to-value mortgages. This will be of great benefit to the local market but wont really impact on the international property buyer as the properties offered for sale as a rule don't interest overseas buyers. So the banks are coming into line with the rest of the market and maybe they will sell a few more units in 2011 but the reality is that most of the asking prices were ridiculous to start with.