Fallas fiestas are over. Valencia takes a break in mid March for its annual Fallas Fiestas and this year there is a gap between Fallas and Easter meaning we can actually get some work done. In the background we are working to get more properties on site but there is a huge caveat here.
Owners are getting ridiculous.
We have turned down two listings this week from English and Swedish sellers because their expectations of price are off the scale of mad. We only list things that are worth selling. Overpriced
property from sellers expecting the moon on a stick will not be listed. One of them actually asked us to lie about the size to make it look better value. Not gonna happen!
Therefore if it seems that we are listing more slowly the reason is unrealistic sellers rather than a lack of endeavour on our behalf. Everything we list is put on site for a
reason, that reason being value for money, great location, great price, opportunity or a combination of all of the above.
Interest Rates are Rising
The European Central Bank has raised the base rates again against
which mortgages are offered. This means that mortgages have become more expensive. For the vast majority of our clients this makes no difference as they don't get mortgages having sold a property in their own country before coming here. However this does affect the major part of the market, Spanish buyers in Spain the vast majority of whom buy with mortgages. Talking with various agents recently there seems to be a tendency towards deals falling through due to a lack of finance. This has not yet
translated itself into an effect on the market but it can't be long before that happens.
One other effect though is being seen. Deals falling through because of a comfortable current mortgage. I heard a story of a purchase falling through because the buyer was offered a 3.75% variable rate mortgage on the purchase whereas they were enjoying a
1.5% fixed rate on their current home. This translated into a doubling and more of their monthly payment for a property that was not much better than the one they currently live in. Therefore they puled out preferring to remain paying a comfortable mortgage where they know every month what they are going to be paying rather than speculating on what they might be paying further down the line on a variable rate.
We may see this happening more if the ECB continue to raise rates. However, if the raised rates cause banks to fail such has been the case in the USA with SVB and Sovereign then there may be a pause on the rates increasing.
The Market Remains Strong
The mid and upper parts of the market are still strong with good properties being quickly snapped up and the lower end of the market is quicksilver. As mentioned in our blog post last week it is rare now for anything decent under 200k in Valencia to remain on the market for a long time.
It's because of this that we ask people to fill in a form with requirements rather than asking to see a particular property "when they visit next
month". It is likely to be sold. You can fill your form in on this link.
