Property agents operating in the Marbella area are reporting mixed market activity with a marked increase in the number of enquiries from overseas property investors, but potential buyers are still very hesitant.
The agencies say in general the British are generally very cautious, especially when it comes to making a major purchase such as a holiday home in a foreign country.
And this caution has increased during 2010 and 2011 as those interested in the Spanish property market have been hearing stories that property prices have crashed and there is little likelihood of things getting any better in the near future.
There is no doubt there has been a house price crash in both Spain and Britain but different areas are coming out of the recession in different ways for different reasons.
The prices of property in the major cities such a Madrid and Barcelona are still falling although the rate has slowed markedly.
But in the Southern Costas, where foreign buyers from Northern Europe such as the British, Germans and Russians tend to buy, the property markets appear to have turned the corner although the recovery is still in its very early stages.
In popular tourist destinations like Marbella there is a lot of pent up interest prompted by undeniably cheap property, but there are still fears that prices may start to decline again.
Some agents believe that this uncertainty over prices has not been helped by the Spanish Banks. They have released many thousands of repossessed properties onto the market just when the recovery was starting.
The banks had no choice as they are being forced to sell these repossessions by their regulator, The Bank of Spain.
While this may be good for the property market in the medium term, the law of supply and demand says that increased supply leads to a fall in prices.
The frustration for the Marbella property agents is that they can see many bargain properties in the market but buyers are hesitant. The agents know that when prices do start to rise, there is likely to be something of a stampede into the market and prices will rocket.
The frustration for the potential buyers is that they have seen a property that suits them, but are concerned that they may pay too much.
Property experts believe the logjam will break soon and are advising British buyers to take taking positive action to secure a Marbella bargain whilst they are still available.
Michael Liggan, a property hunter with www.altavistaspain.com said: “We know buyers are looking for the best combination of price, value and finance. That’s why we seek out those rare exceptional developments, which we can negotiate the very best deals on and then offer exclusively.
“Such properties are limited as they’re hard to find and we never know when we can find more: Make haste while they’re there.”
