S & P Predicts Spain Will Grow by 0.5% in 2014

According to their quarterly report on the economy of the eurozone, the credit rating agency, Standard & Poor’s (S & P), predicts that the Spanish economy will grow by 0.5% in 2014, one tenth less than their July estimate, and that unemployment will continue to increase up to a maximum of 27%.

S & P has maintained unchanged the forecast for Spanish economic contraction in 2013 of 1.5%, but has improved by five tenths the unemployment rate with which the Spanish economy will close this year, from 27.2% to 26.7%.

However, the unemployment forecast for next year remains unchanged, at 27%, as the agency assumes that the unemployment rate will rise again in 2014, before starting to decline in 2015.

The Spanish economy is expected to grow again in  2014
The Spanish economy is expected to grow again in 2014

The agency also includes for the first time in its quarterly report, their forecasts for 2015, the year in which they predict the Spanish economy will grow by 1.1% and the unemployment rate will drop to 26%.

In the agency’s worst case scenario, with a longer recession than previously predicted, Spain’s GDP could fall by 1.9% this year and continue to decline in 2014 and 2015, with a decline in activity of 1% and 0.3%, respectively.

In the report, the agency notes that the Spanish GDP performed better in the second quarter than in the first, and highlighted the “notable exception” in the good performance of Spain’s exports compared to its European partners.

On the other hand, they stressed that unemployment has fallen for four consecutive months since March, suggesting that there has been something more than a temporary increase in tourism. In addition they noted that the August PMI had also been “good news”.

Regarding the eurozone, the agency said that although the data indicated a general improvement in economic conditions, which points to stabilisation in the second half of 2013 and modest growth in 2014, a “robust” recovery is not yet expected.

According to El Economista, S & P forecasts a GDP contraction of seven tenths for the eurozone, thus improving the previous estimate of a decline of 0.8%, while for 2014 they predict growth of 0.8%, one tenth more than the previous forecast, and 1.5% in 2015

Article source: Kyero.com

Is a Spanish mortgage a better option?

Having made a decision where you want to call home and also which property to purchase, the following step of purchasing a home is usually how to find the funds to pay for it. For everybody apart from the wealthy, this will likely entail obtaining a mortgage.

It may be worth arranging the mortgage before deciding on a property

Qualification requirements in Spain depend on your own personal capacity to pay back the money you borrow, and could well be stricter compared to your own country. Typically, your overall regular monthly expenses such as repayments must not surpass 35% of the net income. Loan providers may take into account some types of earnings outside your income, for example that from rentals and other investments, however usually in Spain they don’t always take these in to account.

Should you obtain a mortgage from a Spanish loan provider, or perhaps from back home? Benefits of obtaining a mortgage in Spain consist of reasonably low interest payments, much less management complexity and, if you want to rent your home, maintaining all funds in Euros. Nevertheless, looking at Spain’s present financial situation, it might be hard to get a good option.

In addition, mortgage loan products like buy to let and well-known features like reduced fees and penalties with regard to earlier repayment might not be offered. Several non-resident mortgage loans are inelastic and out-of-date and don’t provide the overall flexibility a lot of consumers would like. Additionally, the standard mañana culture may result in lengthy administration times so its worth lookihng in to arranging the mortgage before the search for the property.

This example is slowly improving. Several lending institutions now have awakened to the fact that there are rewards available from the large numbers of non-residents purchasing holiday homes, and now have set up non-resident divisions that will look on foreign loan provider expectations far more sympathetically.

It could take quite a while to get the mortgage you would like – more time if you are not fluent in the local language. Spanish loan companies tend to opt for your main income source to be a regular salary, and could overlook less regular income sources like dividends and also self-employment. Acquiring a mortgage broker could help to ameliorate these kinds of issues.

Mortgage types:-

The repayment mortgage is considered the most typical type in Spain. It’s conditions depend upon whether or not you qualify as a Spanish resident or not. Should you have held a Spanish residence card or perhaps a certificate, and have been paying taxes in Spain for two years or maybe more, you could be entitled to a Spanish Resident mortgage. It has the best loan-to-value ratio (LTV), and also the most favourable rate of interest, which in Spain is linked to the European standard borrowing rate, known as the Euribor.

Click link here to calculate your mortgage  – Mortgage calculator

Fall in House Prices Moderates in Second Quarter

The National Statistics Institute reported on Friday that house prices fell by 0.8% in the second quarter of the year compared to the previous quarter, representing the most moderate decline since the fourth quarter of 2010.

Thus, the fall in housing prices has moderated, after the pronounced decline of 6.6% registered between January and March, the biggest quarterly decline recorded since 2007, the year in which the National Statistics Institute began developing this index.

Specifically, Europa Press reported that second-hand home prices decreased by 0.1% compared with the first quarter, while the price of new housing fell by 2.4%.

Year-on-year (second quarter of 2013 over the same quarter of 2012), the price of housing also moderated its decline to 12%, compared with the 14.3% annual decline experienced in the first quarter.

Housing prices have now accumulated 21 consecutive quarters in which they have registered negative annual rates. The prices began to fall in the second quarter of 2008 (-0.3%), and since then the trend has not been reversed.

The House Price Index published by the National Statistics Institute complies with the requirements of Eurostat and complements the report published quarterly by the Ministry of Development. Among its objectives is to serve as a point of comparison between Member States in terms of housing prices.

Article source: Kyero.com

Foreign Buyers Bolster Housing Market

According to the latest housing statistics published last week by the Spanish Ministry of Development on the Government website, La Moncloa, 345,471 homes were sold in Spain between July 2012 and June 2013, representing an increase of 2.3% over the previous twelve months.

The statistical results of residential property transactions made before a notary show that in the second quarter of 2013, a total of 80,722 homes were sold in Spain, representing a decline of 4.2% compared with the second quarter of 2012.

With regard to the territorial distribution of these transactions, five regions recorded positive year-on-year results, and 12 registered declines. Prominent among the highest increases were the Canary Islands (16.2%), Catalonia (12.1%) and Murcia (9.5%), while the most significant declines, year-on-year, were registered in Extremadura (-38.4%), Navarra (-33.6%) and the Basque Country (-33.1%).

By province, 17 registered year-on-year increases, with Girona (36.0%), Huesca (32.7%), Palencia (30.7%) and Malaga (21.2%) heading the list. 34 provinces registered negative results, the most pronounced being those for Guipúzcoa (-53.1%), Toledo (-43.8%), Álava (-42.6%) and Badajoz (-39.2%).

For municipalities, those recording the highest number of sales were Madrid (5,269), Barcelona (2,813), Valencia (1,561) and Seville (1,228).

Among the provincial capitals and municipalities with more than 100,000 inhabitants, noteworthy because of growth were Huesca (94.4%), Girona (82.4%), Logroño (79.5%), Barakaldo (75.2%), Leganés (65.2%) and Teruel (61.9%). As for the biggest declines, these were registered for Getafe (-68.0%), Caceres (-52.0%), Badajoz (-51.7%), Vitoria (-45.8%), Toledo (-45.3%) and Cadiz (-44.4%).

The number of transactions for new housing amounted to 14,056, representing 17.4% of the total transactions in the second quarter of 2013, while there were 66,666 transactions for second-hand housing, accounting for 82.6% of the total.

Housing transactions made by foreign residents in Spain has experienced year-on-year growth for eight consecutive quarters, and increased by 28.4% compared with the second quarter of 2012, reaching a total of 12,546 purchases. In addition, purchases made by non-resident foreigners totalled 1,086 in the quarter, which also represented year-on-year growth for eight consecutive quarters.

Taken together, the purchases made by foreigners (residents and non-residents) account for 13,632 of the transactions, which represents 16.9% of the total, and the highest percentage recorded in the historical series (2006-2013).

By province, those registering the most purchases by foreign residents were Alicante (3,543), Malaga (1,771), Barcelona (1,008), Tenerife (921) and Girona (767).

Article source: Kyero.com