European Second Home Prices Wilt in Drought

Spain and Portugal have suffered one of their worst droughts on record this summer, with consequences from empty swimming pools for the tourist to economic disaster for farmers losing their crops and livestock.

Roger Munns, Managing Director of Tribune Properties, predicts that property prices in the two European countries could drop as much as fifteen per cent in some areas as more owners decide to put their villas and apartments on the market.

'For many owners of second homes the original motivation to buy was to have somewhere they could spend time in a relaxing environment. Coupled with the thought of a good investment for the future, the market for overseas homes from buyers in the UK, Germany and Scandanavia has really taken off in the last twenty five years.

But soaring temperatures and a strain on the water supply could have consequences for their rental returns next year, which many owners rely on to meet their overseas mortgage.

Many holidaymakers want to rent a villa with a pool ? but the attraction soon goes if the pool is empty. Some golf courses are having to cut down on watering their greens too, and it won't take a big fall in tourism to mean the difference between breaking even and not being able to meet the mortgage commitments for some overseas property owners.

This autumn could see more properties than usual being put on the market, with a consequential fall in prices'.

Early warning signs of a potential fall in property prices have already been seen on the Spanish Mediterranean island of Menorca, which has enjoyed better rainfall this year than the Spanish mainland and no water restrictions, but some villas being cut in price by over ten per cent.

Water restrictions on the mainland are having an impact on potential villa buyers, with many questioning the value of a swimming pool when they might not be able to use it.

Portugal has recently asked Spain for 6 million Euros in compensation, as water levels in the River Douro which runs through both countries fell below limits established in a bilateral agreement,with Portugal coming close to accusing her neighbour of stealing her water.

Good Time to Buy

'For anyone considering buying a property in Portugal or Spain, this September and October could be the ideal time to buy', say Tribune Properties. 'Unusually many properties were being reduced in price in August, traditionally a good month for sales.

We normally see villa and apartment prices being dropped mid September onwards when the tourists and potential buyers are thinner on the ground as some owners are keen to sell and don't want to wait until the following Easter before having a real chance of selling again.'

The drought isn't the sole cause of property prices falling add Tribune Properties, saying it has accelerated price falls and come on top of an already poor year for many estate agents in Europe.

'A good barometer for European property are the tax havens of Monaco and Andorra which don't rely on 'tourist' buyers, but usually have a steady supply of buyers interested in taking advantage of the zero income tax rate. Andorra is in the Pyrenees and has no water supply problem ? but estate agents were twiddling their thumbs this summer waiting for buyers to show ? and they didn't.

Monaco similarly has had no water supply problems, but has also seen a lack of buyers. The tourists are still visiting the Principality and hotels in Monaco and Monte Carlo have been as busy as ever, but again there is a lack of serious property buyers, and negative property inflation is quite possible in Monaco this year for the first time in a decade.

With more property available on the market we would suggest buyers draw up a list of three or four villas they have viewed and liked, and then suggesting to the owners that they would consider buying at fifteen per cent below the advertised asking price to see which ones are prepared to consider it.'

Sea Water

One possible answer to secure the long term tourist trade and consequential property market is to follow Malta's example of building desaliniation plants, converting sea water to drinking water, sometimes known as 'reverse osmosis'.

The Mediterranean island competes with Portugal and Spain for the attention of second home buyers, and has a healthy tourist industry ? despite having no rivers and low rainfall, allowing the island to function normally even in drought conditions.

The water from this source can be used for agriculture and ensuring adequate reserves to fight forest fires for example - it might just be the answer too for the swimming pools and golf courses ? and would allow a plentiful supply of high quality for domestic use.

For details of hotels in Monaco, Monaco's weather, a map of Monaco, the Grand Prix and direct contact details for the Hotel de Paris, Columbus Hotel and others visit http://www.yourmonaco.com

For property and real estate in Malta http://www.maltaproperty.info and for Andorra property http://www.propertyandorra.com

---

How Real Estate Investors Use Mortgage Note To Purchase Properties

Many of you may not be aware of the various... Read More

Buying Real Estate Thats Not For Sale

Buying real estate can start with a look in the... Read More

Important Information For Condo Buyers

Here is a step by step guide for buyers looking... Read More

Destin Florida Triples In 3 Years

Do you want to see something that is absolutely amazing?... Read More

Realty Agents: Don?t Ask Don?t Tell?

Real estate stories radiate from the water cooler and cocktail... Read More

Buying a Home ? Dealing With Lender Letters

Most people who set out to buy a home, be... Read More

FSBO Novel Preface

PrefaceWe are For Sale By Owners, "FSBOs." We spend our... Read More

What Does It Take To Be A Donald Trump in Real Estate?

Since you are a business oriented person, you might be... Read More

Condo Hotel Trends - A Look at the Big Picture in Vacation Home Ownership

Condo hotels are one of the hottest products in today's... Read More

Purchase Online Tenancy Agreements

Buy an on-line Tenancy Agreement now. As a landlord and... Read More

Attention To Details Helps Homeowners Sell Fast In A Buyers Market

Your boss has just given you the career opportunity of... Read More

Why Property Investors can Crash and Burn

Many experts say you can't lose if you put your... Read More

Investing in Residential Real Estate: Achieving Positive Cash Flow

When investing in real estate, it is highly desirable to... Read More

How to Choose the Proper Entity for Your Business

First, let me state that I'm not an attorney and... Read More

How to Calculate Real Estate Rehab Profits

If you are investing in real estate you will face... Read More

Home Selling: Making It Easy On Yourself!

It's a dream for many to buy and take ownership... Read More

The Value of Foreclosed Property

The discount on a foreclosed property is not as great... Read More

Product Review of Carelton Sheets No Money Down Course

Real estate continues to be a very important part of... Read More

A Possible Bargain: Foreclosed Properties

In the superheated San Francisco Bay Area property market, foreclosed... Read More

An Often Overlooked Secret of Marketing and Negotiating for Real Estate Investors Looking for Deals

When you call sellers, what do you say? When you... Read More

How Can Real Estate Investors Profit From The Internet?

The Internet is a powerful marketing tool, but just how... Read More

Be Patient Screening Tenants

Rental real estate is a solid way to make money.... Read More

Advantages and Disadvantages to Selling a House on Your Own

As with any business transaction, there are pros and cons... Read More

Using Transformation Psychology to Sell Investment Properties

Satisfying and lucrative real estate investment depends upon your correct... Read More

Realtors Brainstorm For Business

Even though rates are down opening up the market for... Read More

Real Estate Business

Starting real estate business is not that simple. Multiple aspects... Read More

Taxes When You Sell Your Home

What's the difference between death and taxes?Death doesn't change every... Read More

Credit Help: Buying Real Estate -- Not the Same as Buying Cars

Credit for Buying Real Estate is Different than Credit for... Read More

Best Time to Buy? Best Time to Sell?

When is the best time to buy? When is the... Read More

How To Get More Money For Your House

If you are thinking about selling your house, you should... Read More

Make Your House Earn Its Keep

Did you realise that there is a lot you can... Read More

Escrow From a California Homeowners Perspective

The Escrow ProcessBoth Buyer and Seller deserve the assurance that... Read More

Florida Investment Real Estate and What Are Considerations Before Buying

Investment Real Estate, First Things FirstConsidering investing in property? What... Read More