Trump down the volume: how Spain can help banish the election noise

Trump down the volume: how Spain can help banish the election noise

All Trump-ed out? Spain can help with that...

The USA has elected its 45thPresident, Donald Trump. If that is news to you, then be prepared to share that rock under which you’ve been hiding.

The pitch that will follow this surprising election result will become more fevered than a Chicken pox-ridden toddler over the next few days, and while there are bound to be some funny memes hiding amid the media onslaught, one could be forgiven for wanting to tune out and turn off.

Spain is the perfect place in which to do this, having already proven for most of 2016 how little politics actually matters – the country has run itself rather well without a proper government in place, so here are three other ways that Spain can help you dump the Trump…

  1. Hit the beach

The scenes from New York this week have been dominated by ruddy-cheeked young Republicans whooping wildly into the cameras, dressed in thick coats and wrapped in scarves. Yep, it’s cold in New York this time of year, as it is in much of the Northern Hemisphere come mid-November. In southern Spain, however, although it’s been a bit chilly this week, it is certainly sunny enough to head to the beach to get away from it all, and you’ll have the place pretty much all to yourself.

  1. Eat, drink and be merry

Not only is Spain home to the world’s best restaurant, but Spanish cuisine has become one of the most popular food types across the globe, with most towns and cities in Europe now boasting a fine selection of tapas bars and restaurants.

And as the nights draw in there are few cosier experiences than huddling with friends and family in one of the many tightly-packed bodegas and tapas joints dotted along the Costa del Sol, offering up the finest in Spanish hospitality, cuisine, beer and wine… lots and lots of wine.

  1. Go home hunting

One industry that is immune to the ups and downs of the calendar is the property market, which has just posted another strong month for sales transactions.

So if you really want to get away from it all, how about a rustic old finca in the Andalusian hills? Or a modern two-bedroom apartment in a quiet urbanisation on the fringes of the coastline? Or how about a luxurious villa complete with private pool and shrouded in security and solitude? Spain offers all of this and more – and with Netflix and Napflix both available, you will never have to lay your eyes on Donald Trump again…

As of September almost 400,000 homes sold in Spain in 12 months

As of September almost 400,000 homes sold in Spain in 12 months

September’s property sales have continued the upward trend, reflecting the strengthening nature of the Spanish economy.The latest data from Spain’s Office of National Statistics (INE) published yesterday revealed that in the 12 months to September 30, 395,000 homes have been sold in the country…
 September's property sales have continued the upward trend, reflecting the strengthening nature of the Spanish economy.This represents a 13.2% increase year-on-year, and is the highest figure since the 12 months to the end of July 2011.

While that magical 400,000 figure is still some way short of the 775,000 homes sold in the 12 months of 2007, it does represent a healthy return of activity in the Spanish property market, and continues a steady and stable period whereby 24 out of the last 25 months have seen the number of home sales increase.

For September 2016 the figure is 34,931 homes sold for the month, which is also 13% higher than in September 2015. Taken for the year as a whole, the 311,000 properties sold so far in 2016 would suggest that the year might well end with the highest number of housing transactions since 2008 – the final year before the global credit crunch and subsequent Spanish recession.

In terms of home sales per 100,000 residents, Andalucía’s figure was over 100, which indicates that there is currently a good split between local, domestic buyers and international foreign buyers.

This has long been the case in Andalucía, where the property market is buoyed by the robust sales evident on the Costa del Sol, and particularly the luxury homes sold regularly in and around Marbella to wealthy buyers.

Three things on the new Spanish Prime Minister’s to-do list

Three things on the new Spanish Prime Minister’s to-do list

Rajoy has been re-elected as Spain PM, and here are three issues he must address right away.Ten months after first going to the polls, Spain finally has a new Prime Minister (PM). Mariano Rajoy of the Popular Party (PP) has been reinstated as the PM after serving between 2010-15, and then throughout this year as an interim while the various leading parties tried in vain to form an alternative government.

But after months of deadlock, the Socialists (PSOE) agreed to stand aside and allow the PP to reclaim parliament – albeit with vastly reduced power.

Rajoy has been re-elected as Spain PM, and here are three issues he must address right away.So bearing this in mind, here are three things that should be high up on Mr. Rajoy’s to-do list…
1. Handle the economy gently

During the rudderless 2016, Spain’s economy has grown above and beyond projections, and will likely end the year with a GDP increase higher than three per cent. In itself this would be encouraging, but for such growth to have occurred in a country that has had no settled government all year is mightily impressive.

So what does this mean? It means that the laws and policies put in place by the PP during its previous government had the desired effect: to liberalise labour laws, energise the job market and restore faith in Spain’s banking, real estate and hospitality industries. All Rajoy has to do is lightly grasp the wheel and let Spain’s economy steer itself.

 

 

 

 

2. Make friends in high places

Rajoy returns to the role as Prime Minister with his powers vastly reduced, heading into government with just 137 PP seats in parliament, out of a total of 350. This means that the PP’s policies will come under heavy scrutiny by the many left-spain-2_3531773b-434x271leaning politicians in the chamber.

For Rajoy, he needs to be aware that some of the more conservative measures his government introduced last time will face stiff opposition this time around. The upshot of this is likely to be more compromise and a more centrist outcome of policy, which could do wonders for certain industries that have been battered left and right in recent years, such as Spain’s policies towards solar power and renewable energy.

 

 

 

A British Union Jack flag and an European flag fly on the Amiens city hall during a a Franco-Britain summit in Amiens3.  Face the Brexit question, and fast

The issue of Brexit was never going to be far from the thoughts of whoever became the new Spanish PM. With more than one million Brits living in Spain and many thousands of Spaniards living in the UK, managing the post-Brexit relations between the two countries is going to be one of the most critical decisions the new PM will have to face.

So far, Rajoy has made encouraging noises on the matter, to the effect that little will – or should – change for Brits who already live in Spain. However, with thousands of Brits eyeing the opportunity to move to Spain every single month, Rajoy is going to have to find ways to ensure this process remains as smooth and as simple as possible.

Affordable Spanish mortgages to continue for two more years at least

Affordable Spanish mortgages to continue for two more years at least

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Fixed rate mortgages in Spain are currently very affordable, and are likely to stay that way for at least two years.The low interest rates that are currently shaping the Spanish mortgage sector are set to continue for at least two more years as the uncertainty over the future of the Eurozone continues, experts have said…

 Low mortgage rates in Spain have been one of the driving reasons for the surging recovery of the property market over the past 24 months, and the country is going to stick with the fixed rate mortgage levels offered by the Euro Interbank Offered Rate, also known as the Euribor.

The Euribor is something of a safety valve for Europe’s property sectors, setting an average rate of interest payments across most of the Eurozone based on how the economies are performing. The European Central Bank, spooked by recent financial blips across Europe, is expected to continue to hold the Euribor rate below zero until at least 2019.Most Spanish mortgages are pegged to the Euribor, which in September dipped to -0.057% – the eighth-straight month of negative rates. Normally, such sustained low interest rates would only be deemed viable for short periods at a time, and are generally introduced to help stimulate national markets.But just like how Germany’s export-based economy benefited for years from the low euro, Spain’s property market is now set to reap the gains of low interest rates as standard across Europe. Spain’s property market is one of the more dynamic in the Eurozone, and certainly the most popular among foreign – chiefly British – buyers, who are being offered favourable terms when purchasing a home in Spain.With the Euribor even expected to plunge to perhaps -1 per cent in 2018, monthly repayments on mortgages could become even lower, which in turn will only turn heads towards the Spanish property market.Spain’s banks, on the other hand, have to be wary. While adding more mortgage customers will be welcomed, to do so at continued low interest rates could have a long-term impact on their own profitability, causing them to tighten lending in a few years’ time.However, having been through the mill with the Spanish real estate sector in recent years, most sensible banks will be keeping a close eye on the near future to ensure the market does not overheat but, instead, grows sensibly and solidly – as it has been doing since the beginning of 2014.

20% spike in August Spanish home sales

20% spike in August Spanish home sales

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Although monthly home sales are way down on the peak levels of 2006-7, this year’s figures are higher than they have been for six years.

The month of August 2016 is likely to go down in history as a record-breaker for Spain for many reasons.

Boosted by millions of extra tourists flooding into the country at the height of summer, Spain has seen record spending by consumers, more overnight hotel stays than ever before, and more flights in and out of the country…

All of this was bound to have a positive impact on Spain’s property market, and the latest data from the Office of National Statistics (INE) does not disappoint – figures show that the number of home transactions recorded in August this year was 20.3% higher than last year.

In total, August saw 35,501 homes change hands for the month, which is the highest figure since 2010, and marked a continuation of the positive trend that has characterised Spain’s property sector for many months straight.

For the first eight months of the year, Spain has seen 276,000 home sales nationwide, which is an increase of 14.8% on the same period last year.

Taken over the past 12 months, the 391,000 homes sold in Spain represent an annual 13.3% increase, and many experts are confident that this trend will continue for at least five more years as Spain’s economic recovery continues.

The country’s GDP is set to end the year with around 3% growth, which has supported sustained domestic demand in the real estate sector. Foreign demand has also been strong in 2016, largely as a result of steady British interest over the course of the year.

However, buyers from France, Germany and Scandinavia still play an important part in the market, while Chinese buyers are also growing steadily in number as Spain’s charms continue to turn heads the world over.

Expat life is a two-way street, which is why the weak pound is not all bad news

Expat life is a two-way street, which is why the weak pound is not all bad news

A strong British pound was always great news for British holidaymakers, but expats in Spain benefit when the euro rises.Last week it was confirmed that the two-year process of pulling the UK out of the EU – the triggering of Article 50 – will begin in early 2017. This news prompted the predictable flurry of doom-mongering articles and mild panic. That was to be expected. What was perhaps more surprising was the sharp drop in the pound against the euro that was recorded immediately afterwards…
 A strong British pound was always great news for British holidaymakers, but expats in Spain benefit when the euro rises.

And while the pound has subsequently recovered somewhat, it is still rather weaker than it has been for years. A year ago a pound would have bought you €1.34. Today it gets you just €1.12. That is some fall in the space of a year, and many economists argue that it is only going to get worse as Brexit approaches.

But it should not be all doom-and-gloom for current or future expats. Right now, the euro is at its strongest point for more than three years, and that is unlikely to last. The euro’s value ebbs and flows more than the pound’s, so as Brexit approaches, there will certainly be a few more ups and downs between the two currencies.

Another point to consider – perhaps the most pertinent one of all – is that expat life is a two-way street. Living in Spain and earning or spending in euros does not mean that the pound’s fortunes no longer matter to you.

Indeed, for many Brits who currently live in Spain, the cheaper pound is a godsend– it makes it that much more affordable to fly back to see family, to have their favourite goods shipped over, to fly friends over, and to purchase things online with their UK bank card.

Sure, Brits looking to sell up and move to Spain may find that their home will be worth slightly less, but a more affordable property is easier to sell, meaning they can secure that life overseas more quickly than they perhaps could have while the pound was strong.

There are many nuances to foreign exchange rates, right down to how rich you are compared to how rich you feel. If the pound is suddenly worth less, then those euros in your pocket feel like they are worth more. That alone is a good feeling for current expats.

And for those unsure whether to take that next step and move to Spain, then the knowledge that the euro is among the world’s most stable currencies should be reassuring enough – there might well be no better time than right now, before Brexit, to make that move to Spain.

Zara boss snaps up Madrid skyscraper for €490 million

Zara boss snaps up Madrid skyscraper for €490 million

Cespa Tower, furthest right, is one of four iconic skyscrapers that have shaped Madrid's modern skyline.

The Cepsa Tower, furthest right, is one of four iconic skyscrapers that have shaped Madrid’s modern skyline.

Europe’s richest man Amancio Ortega knows a thing or two about smart investments. The founder of global fashion group Inditex, which owns the brand Zara, has long been one of the wealthiest individuals in the world thanks to his business savvy and eye for a good deal…

 So it was with interest that the Spanish real estate industry watched the news that Ortega has just paid €490 million for one of Madrid’s most iconic skyscrapers.

 

 

 

 

Known as the Cepsa Tower, and one of four towers that dominate the skyline across the northern part of Madrid, the building had previously been owned by Abu Dhabi oil sheikh Khadem al-Qubaisi.

Ortega decided to add the tower to his growing property portfolio after arranging for his holding company Pontegadea Inmobiliaria to exercise a last-minute purchase option via Spanish lender Bankia.

The sleek building adds to Ortega’s growing selection of real estate located in enviable locations, including buildings on Oxford Street and Mayfair in London, as well as prime spots in Seoul and New York.

Rather cannily, the tycoon rents out some of his properties to rival fashion chain H&M, although just what he has in mind for this latest venture remains to be seen.

The Cuatro Torres complex in downtown Madrid is a mixture of hotels, office and retail space, and private residences, but tenants can rest assured that, with Ortega as their landlord, they are in more than capable hands.

Volume of Spanish home sales at highest for five years

Volume of Spanish home sales at highest for five years

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Property sales for June are 19.4% up on last year, while for the first six months of the year that figure is a strong 16.4% increase.

Official statistics published late last week by Spain’s Economic Ministry have revealed that the number of homes sold in June was higher than it has been for five years.

According to the data, June saw 36,856 transactions registered nationwide, which represented a 19.4% increase on June 2015 and was the highest for any month since August 2010. The figure also represents 100 sales per 100,000 inhabitants of purchasing age – a threshold that has long been seen as a marker of a healthy property sector…

Regional sales increases were recorded in 15 of Spain’s 17 autonomous communities for the month, with only Navarra and La Rioja bucking the upwards trend. And June was no blip. For the year to date, the average number of transactions per month is 16.4% higher than the same period last year, and when that trend is looked at over the past 12 months, the increase is still encouraging, at 14.7%.

Not since August 2011 has the Spanish property market enjoyed such a year-long upturn in activity, and that coming off the back of one of the worst recessions in living memory.With Spain’s economy improving and set to see GDP grow by more than 2.7% this year as well as next, and with the country enjoying a bumper summer season, those dark, post-recession days are fading ever more into history.

Further encouraging data on the strength of Spain’s recovery and enduring popularity came this week from the Airports Council International Europe (ACIS), which found that both Málaga and Alicante airports are two of Europe’s fastest growing, recording increases in passenger numbers in the first half of 2016 of 14.6% and 16.1% respectively.

“These figures confirm what a magnificent year we’re experiencing on the Costa right now. Not only does it show record numbers, but also our growth in a European context,” said Elías Bendodo, president of Turismo Costa del Sol. “The steady growth in the past six months confirms our prediction that 2016 will be a record year for tourism here.”

A father, European, aged between 40-50: profile of Spain’s most likely property investor

A father, European, aged between 40-50: profile of Spain’s most likely property investor

The most common profile for foreign investors in Spanish property ismiddle-aged fathers from northern European countries, according to arecent survey by Iberia Real Estate.

The real estate franchise recently analysed its data and found that men with families,aged between 40 and 50, and largely hailing from the UK, Ireland, Germany and the Scandinavian countries were most interested in purchasing property in Spain…

The survey also found that on average, two out of every ten foreign visitors to Spain harbour serious considerations about purchasing a property in the country – with popular tourist hotspots such as Andalucía, Valencia and Catalonia leading the way.

With tourism numbers at record levels for 2016, this means great news for the Spanish property market. A recent report by Spanish newspaper El Mundo calculates that nationwide, Spain will record a 30% increase in property transactions this year, a rise largely fuelled by the resurgent domestic market, but also ably supported by wealthy foreign buyers opting for Spain’s safe-haven status.

As many other would-be holiday and investment locations on the continent have suffered the devastating effects of terrorism over the past 18 months, Spain has reaped the benefits in both numbers of visitors and volume of cash injection.

And the profile most likely to say “Si, por favor” to a home in Spain comes as no surprise. The middle-aged male demographic of most northern European countries tends to also be the wealthiest, and with the economies of the UK, Germany and most of Scandinavia performing well, it is little surprise that investors in Spanish property largely hail from these countries, and this group.

Equally prescient is Spain’s excellent property market, which offers a winning combination of affordability, good quality, choice, and ease of doing business. All of this is augmented by a culture that is not so far-removed from northern Europe, a warm climate, excellent infrastructure and superb education and healthcare facilities across most parts of the country.