The leading ratings agency Fitch has revealed that repossessed properties in Spain have been selling at around a third of their original valuations in 2012. With banks desperate to offload property, buyers have been able to snap up Spanish homes at significant discounts.
Keep reading to find out more about the repossessed property bargains available in Spain.
Repossessed properties in Spain available at significant discounts
Spanish banks have been selling properties at significantly lower prices in 2012 than in previous years, according to Fitch. The ratings agency says that this Ã¢â¬Ëreflects the desire of lenders to offload real estate exposure; the rising number of repossessed properties; newly completed developments coming on line; and the introduction of Spain's Ã¢â¬Ëbad bankÃ¢â¬â¢.Ã¢â¬â¢
According to the rating agencyÃ¢â¬â¢s study of 17,373 Spanish properties, some banks are now selling properties at up to 50 per cent below the price at which the property was valued when repossessed. The agency also found that the banks who are willing to offer mortgage finance to people buying repossessed homes at preferential rates have achieved around 15 per cent more for the properties than banks selling homes without a finance option.
With so many repossessed properties on their books, SpainÃ¢â¬â¢s major banks are desperate to sell off whatever they can. This means that overseas buyers are in a great position to pick up property at around 50 per cent of the repossessed value.Ã¢â¬Â
FitchÃ¢â¬â¢s report said: Ã¢â¬ÅWe think it will take several years to absorb the stock of properties that have to be sold, even if sales volumes were to rise back to their 2003-2004 levels of 250,000/300,000 per year. There are approximately one million newly built homes for sale, 200,000 repossessed properties, and an unknown number of arrangements to exchange debt for property.