Due to the economic climate we are accessing for clients an increasing number of distressed Mallorca property opportunities. These forced sale opportunities offer investors the possibility of excellent long term returns or for lifestyle purchasers the chance to buy luxury Mallorca real estate at very low prices.
While we maintain that the Mallorca property market and the wider national and international economic backdrop remain "complicated" we feel that some buying opportunities are emerging particularly where current owner have over leveraged, have cash flow difficulties and are coming under pressure from the banks.
Amongst the opportunities now available in the market are - a spectacular 5* boutique hotel enjoying some of the best views in Mallorca; a luxury designer villa in Pollensa, a house with sea views in Costa de los Pinos, a luxury finca in South West Mallorca close to Andratx and a wonderful front line house near Porto Cristo.
The key for buyers is the availability of funds for the purchase as banks in Spain still have the lending tap firmly closed or at least loan to value ratios requiring equity inputs of around 40%, after costs, for non residents and 30% for residents.
Although unlike the luxury market, where asking prices are often far in excess of underlying values, asking prices reflect the urgency for a sale, thorough market research and due diligence is still required as not all forced sales are "cheap" especially where outstanding loans are in excess of the underlying value for the property. In these cases awaiting bank foreclosure may be the only option even if the paperwork is that much more complicated.
No comments:
Post a Comment