Property Market on the Costa del Sol
The Property Doctor. By Sean Woolley
The Stand-Off Begins
As we reported in a previous column in Home & Lifestyle Magazine, the local real estate market is really beginning to tighten up in its key locations.
Respected professionals in the business have been reporting a definite shortening of the gap between a property’s asking price and eventual selling price in the last few months. As we expected (and predicted in our previous column) more buyers are now entering the market, and this increase in activity has alerted buyers to the prospect of a rising market. Their reaction? To hold firmer on their asking prices.
Within our own business in the last two weeks, we have seen a Spanish vendor attempting to increase her asking price even after a deal had been agreed; and a British vendor deciding to up his asking price by 20 per cent despite receiving a cash offer just five per cent below the asking price – and having had his property on the market for over three years!
This behaviour causes enormous confusion and frustration for prospective buyers. Most educated property hunters are well-researched and realise that the days of “giveaway” properties are over in the best areas of the Costa del Sol, but they still rightly expect to be able to agree a decent deal, particularly if they are mortgage-approved or are cash buyers.
Yet it seems that we have hit a stand-off in the market: sellers are becoming more confident, while buyers are increasingly becoming the victims of these raised expectations.
Sellers may well be right. We seem to be emerging from a crippling recession, and people seem to be in the mood to spend their money once again, but sellers also need to remember that, in most cases, buyers don’t actually need a second home on the Costa del Sol. It is a luxury for most of them – a desire rather than a necessity.
While buyers will be frustrated by vendors changing their minds and upping their prices, this doesn’t represent a total calamity for most property hunters. They will normally bide their time or turn their attention to other options in the market.
This is a risk that most sellers are reluctant to take but, with the Brits starting to return to the market en masse after sterling’s recent rise against the euro past the 1.25 mark, who’s to say that there aren’t further price rises on the way?
Sean Woolley, our resident property expert, can be contacted at Cloud Nine Spain: Centro Comercial Guadalmina 4, Local 88, San Pedro de Alcántara; Tel. (+34) 692 254 432; sean@cloudninespain.com; www.cloudninespain.com
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