Spanish crisis meant that there is a unique opportunity to invest in properties. Number of homes seized rose to unprecedented proportions. Some sources say that at least 250 000 increased in number since the crisis hit in 2007.
There are different reasons for this:
- aggressive change labor laws,
- unlimited access to credit – essentially everyone qualify for a mortgage
- irresponsible estimating the value of the property (many banks employed valuators who mistakenly overvalued real estates. So the banks were lending more many than they were supposed to).
All this resulted in a significant decrease in properties values. We come to the point where mortgage is more expensive than the house itself. A lot of borrowers realized that it is no longer worth it to pay it off. And here comes the bank, who desperately wants to get the money back. Takes over the property which very often with negative equity (home security is worth less than the loan amount). Because the bank wants the money back, very often values a real estate on the loan basis. So on the market you would have such an apartment with a price higher than similar to the secondary market. This means that nine out of ten transactions of bank takeovers are not such an occasion. Be aware of that.
After some time, the bank lowers the price of such property. However, the crisis began 2008. For almost seven years the houses were left to themselves. Renewal, reconstruction, or reconstruction, require additional contributions .The most interesting offers have gone already. The remaining ones are for example on the 4th floor, in the building with no elevator, in the middle of the city with a view of another buildings. Do not be discouraged by this. Sometimes you can still find a real diamonds.
And then what happen if you found one? First of all, you need to act quickly. Because such opportunities do not last long. After seeing such property make an offer and begin the sales process. It can be presented in three short paragraphs:
- Book a property – To reserve a property must pay a certain amount to the account of the seller (in this case the bank)
- Sale agreement – Bank is preparing a preliminary agreement, and it takes more or less for about a month after booking. This does not require re-emergence in Spain and this step can be omitted and go straight to the point …
- Signing notary deed – This is the final agreement between the bank and the client (esp: Escritura). On this stage you would have to hand out a check to the bank or already paid on the bank account. After approx. a month to two (depending on if we skip step 2), the bank will issue all the necessary documents and you become the property owner.