The joys of Spains beauracracy

Living in Spain: I was pulled over by the Guardia Civil and asked to produce paperwork for the car. While they were checking details I produced my passport and was asked if I was living in Spain permanantly and I confirmed i had been here 5 years.

The Police man then asked me to provide my residency papers. To which I explained I had no applied yet. I was informed that because I had lived in Spain for more than 6 months I was obliged to obtain residency.

Being a good citizen we today attended the police station with proof of income, private health insurance for the family,proof of school for the kids,bank statements. We took everything to prove that we were no burden to the Spanish state.

The lady behind the desk began to look through the paperwork and then on perusing our Family private health insurance she began to shake her head. "I am sorry Mr Payne but your wifes application for residency is refused as her private medical insurance excludes a particular minor illness" In Spain we cannot accept residency unless your private insurance covers everything the state insurance covers

So to sum it up if you are a UK citizen you can live in Spain but if you have lived in Spain for more than 6 months you must (its obligatory) obtain residency but to obatin residency you cannot be excluded from any illness on your Private health insurance. So if my wife has been refused but as an EU citizen can still live here WHY should anyone bother to apply for residency.Apparently La Linea Policia Nacional office are saying the health insurance ruling started in last 2 months passed by Spanish law.

Anyone else had similar issue or looked into it further. I would be interested to hear from you

Any bargain properties in Sotogrande Spain

At what price will my property sell Its the question agents are continually asked yet the majority of vendors ignore the response.

Do we really believe that there is a wealthy individual willing to part with his hard earned cash who will pay over the odds for a property

yet time and time again agents will quote a selling price only to be ignored the vendors hoping they may strike lucky.

These days when I visit a property to provide a value I mention 3 prices. The first price is my indication of the pre crisis worth, I then tell the owner what I think they will be considering selling for and then advise them what it will really need to drop to to even get a viewing. The latter value the true price that it might sell for is usually an amount that the property owner will not consider selling at. So here we are in Sotogrande with 95% of all property on the market at a price that they have no chance of ever achieving yet believing that someone will come along and pay that price. Then every now and again a property does come on the market where an owner wants to offload and the price is keen enough to attract serious interest.

So how much do we need to drop to generate interest. A calculation based on actual recent sales and there havent been many shows that the majority of owners market their property at 30% to 35% lower than the 2007 value. The facts show that taking a true 2007 value you now have to drop 50% to 55% in order to sell.

The example in the photograph above is a 4 bedroom penthouse duplex apartment on an island in the Sotogrande marina with balcony swimming pool the vendors purchased for just over 1 million euros and with no real interest being shown at 695,000 euros have reduced the price yet again to 599,000 euros.

A San Roque golf apartment purchased pre 2007 for 720,000 euros was put on the market at 500,000 with no viewings in 18 months reduced to 400,000 and 2 viewings in next 12 months. Then reduced to 350,000 and achieved 6 viewings in 12 months. It was not until it dropped to 300,000 euros that suddenly people with real cash began booking appointments, 12 viewings in a month. It sold for 290,000 euros.We also have a 2 bedroom waterside apartment which the owner will sell to include a mooring for 270,000 euros an apartment he paid 575,000 euros for. Its been on the market at this price for 6 months and still no takers. There are a number of other similar stories ove rthe last 24 months

For many owners dropping prices to these levels is an impossibilty due to negative equity. It really is a tough market and whilst many agents talk it up most of it is just that "talk". The hard fact is that those buyers with cash to spend find it hard to find a bargain in a 7 day trip to Sotogrande and often leave contemplating visiting other areas in Spain.

My view is that many owners are not squeezed as interest rates remain low however like all recessions the climate will change at some point at which time (it could be a few years) the interest rates will go up resulting in severe pressure for many property owners and developers currently hanging onto their property. At that point even a half percent increase in the interest rate will mean bargains will be more plentiful as will distressed property bank repossessions.