Things are getting better, every day (so sang Stone the Crows many years ago). President Mariano Rajoy had the same sunny opinion during his state of the Nation Address this week. It’s an election year, and Rajoy needs to swing the voters back behind him. Huge effort will be made to create those extra jobs, and bring back some modest prosperity to the middle-classes. The newspapers have been bought with institutional advertising and certain protections, the opposition is being guilefully criticised, the corruption soap-opera has swung to Andalucía, and the Greeks have been put in their place. What about the PSOE leader’s comment: ‘The Government can be summed up as precarity, taxes and Bárcenas’? Listening further to that Stone the Crows anthem: ‘…learn to live and not to count the cost…’ – maybe someone has missed the point…
A refreshing view of what not to do and not to say when you are selling: ‘No, No, No and No. What Agents and Owners Need To Stop Doing Now’. Found at Spanish-Property.net.
The moving house check-list. ‘…A comprehensive check-list that’s been designed to help you along the way and ensure the transition process runs as smoothly as possible…’. Worth a look here.
‘If you’re not a Spanish national but want to live in the country for more than ninety days a year, the law requires you to become resident, something that, depending on where you’re from, can have more cons than pros…’. The ins and out of immigration in Spain, from Antonio Flores at The Olive Press.
‘In 2014 there was a 19.3 percent increase in the total number of residential properties bought by foreigners in Spain from a year earlier, accounting for almost one on five houses sold nationally, marking a very high international demand for Spanish property…’. An article from Invezz (commercial site).
Notary data 19% increase in Spanish property sales for 2014, reports Spanish News Today.
‘Debate is raging as to whether the new year has stabilised the Spanish property market. A new report from Fitch rating agency suggested property prices will stay at 40% lower than the pre-crisis peak, with the market bottoming out. “Vozpopuli”, however, said that to expect property prices to recover is to live ‘far from reality’ and believes the sector will never return to its former glory…’. From The Olive Press.
Ian from Eye on Spain asks, is now the time to buy? See here.
Hacienda say they will fine any owners community which fails to report any item that costs over 3,000€. About 20% of all communities could be affected with fines from 300 to 20,000 euros. Story and video at La Sexta.
‘…Since the European Court of Justice (ECJ) has ruled that Spain’s IHT tax rules – with different rates for residents and non-residents – were discriminatory, the latter are able to enjoy the same allowances residents are ruled by. Now an EU-resident who inherits an Andalucian estate worth less than €175,000 from parents, children or spouse is totally exempt from paying IHT. This is no small matter. According to figures provided by Junta de Andalucía, 93% of all IHT tax declarations filed in Andalucía did not require a tax payment – thanks to the new allowance…’. From The Olive Press.
A long essay in El Observador from the Ecologistas en Acción, reckons that 90,000 inmigrantes climáticos, as we are referred to by the ecologists, have scampered off to our own misbegotten countries, and Good Riddance! The article is cutely titled ‘Bye, bye to the Warm Spanish Dream’ and takes you to a fuller version on pdf here. The article considers ‘the colonisation of rustic land, urbanisation of non-urban soil, and the economic, social and ecological costs thereof’. Using the improbable numbers from the INE (based on erroneous information), the article claims that, just from the UK, some 760,000 Britons have/had moved to Spain since 1985. Most came as ‘climate immigrants’ (who don’t work, we learn, but ‘vegetate’), although some came to take on jobs which properly belonged to the Spanish. A graphic shows how many have returned ‘home’ (always ‘home’), based on INE figures, from padrón information taken from a four year period in one culling exercise (not, as is defended, in One Year). Those foreign homes caused ‘a false climate of prosperity in the (unfortunate) municipalities concerned’. These ‘bourgeois’ foreign residents ‘live like kings, while at home they would be simply middle-class folk’.
The illegal-home association SOHA, based around the Axarquía (Málaga) comes in for particular criticism, by ‘threatening the Spanish establishment that if they don’t change the laws, then the municipalities concerned will be catapulted into poverty’. The article refers to ‘the polemic Auken Report’ (from the MEP Margrete Auken in 2009 here) considered by the illegal home-makers ‘as a sword of justice’. The article indignantly concludes that some of these foreign defenders of the illegal homes are now getting into local politics. Well! In all, it’s just policy-mongering from the IU/Los Verdes, who are happy to go after the foreign home-owners (who supply hard-needed wealth and jobs locally), but are completely at ease with other, larger ecological issues in Southern Spain – the 30,000Ha of plastic farming in Almería (about the same size as Malta, for example) being an obvious case.
According to the Diario Agent Travel, a five-star hotel room can generate 29,600€ per annum, compared with a four star room’s potential of 14,800€.
How much would be left from 2,000€ earned by a self-employed (autónomo) worker after he had paid taxes, IRPF, IVA and social security? According to an indignant article which has gone viral, the answer is just 938 euros. Meanwhile, an IBEX company would apparently keep 1,942 euros after their taxes…
Tax amnesty on undeclared income. Article from tax-experts Asfemp SL in pdf here.
Is Spain the European country that is experiencing the fastest growth? No. Not even close. El Diario has the graphic here.
Endesa did well last year, with profits of 3,337 million euros. Half of this came from selling off their Latin American business to Enel. Story at the ABC. Telefónica did quite well also, with reported profits for 2014 of 3,001 million euros (down 34.7% thanks to issues in Venezuela and elsewhere).
The State of the Nation speeches were held on Tuesday and Wednesday this week: promises and criticism, as expected. President Mariano Rajoy congratulated himself on leading Spain out of ‘the crisis’ without having to ask for a final European Bail-out, says El País in English here, also noting that Rajoy has promised to help the middle-classes with tax breaks and other small favours. Now, he said, we must turn to creating three million jobs. ‘…“The state of the nation is that of a nation that has woken up from a nightmare, that has bailed itself out, recovered prestige, is attractive to investors, has reorganized how it works and is growing in terms of consumer spending and investment,” he told Congress…’. Less enthusiastic is a report from Diagonal Global which talks of fine words hiding the reality of life in Spain today. The Leader of the Opposition is the young and untried Pedro Sánchez (PSOE), who spoke on Tuesday of ‘precarity, taxes and Bárcenas’. Who won the two-day debate, Rajoy or Sánchez? El Huff Post hands it to Sánchez, Readers from El Mundo slightly preferred Rajoy. A seemingly balanced report on Spain today and the current political rhetoric from (Iran’s) Press TV here. Then there was ‘the Other State of the Nation’.
President Mariano Rajoy estimates the saving, with the e-administration, of some 20,000 million euros. Thus the population can link up to any part of the administration, saving visits and paperwork.
Foreign Minister García-Margallo is determined to make life hell for those who live or work in Gibraltar. Thus the headline in Público, which notes that the Government has no intention of relaxing the stringent controls on the frontier.
Ganemos, or Guanyem in Catalán, have now been accepted at the eleventh hour as valid political names (a municipal version of Podemos, roughly). Thus ‘Guanyem Barcelona’, with just 100 days before the local elections, and with another name already being registered in panic by the group. Now legal. Phew!
In Madrid, despite other runners, the new leader of the socialist PSM is the brother of Iñáki (that irritating commentator), Angel Gabilondo, taking over from the disgraced Tomás Gómez. He will be running in the regional autonomous elections for Madrid (held on May 24th).
Who led the push against Greece? Spain, apparently. ‘As euro-region finance ministers turned the screw on Greece in last Friday’s talks, the group’s usual enforcer, Wolfgang Schaeuble of Germany, was eclipsed by Spain’s Luis de Guindos, according to two people with direct knowledge of the talks…’. So says Bloomberg. Evidently, the Partido Popular didn’t want Greece’s answer to Podemos winning any points. In the end, of course, things were pushed a few months down the road…
‘Madrid has taken a very strong line, supporting Germany’s stance that there should be no debt relief and that the austerity strategy should be continued. This is not, of course, because the Spanish government really means this, though it just might. It’s because – faced with the threat of a boost to the electoral chances of the new left-wing Podemos party – it’s desperate to avoid any suggestion of success on the part of the left-wing Syriza government in Athens. It’s even taken to publicising how much debt relief would cost each Spaniard. This, of course, is nothing compared to the amount per capital shelled out to incompetent/illegal banks…’. From Colin Davis’ Thoughts From Galicia here.
Concern over the current crop of surveys is leading the PP and PSOE to turn on their rivals, Ciudadanos and Podemos, says Vozpópuli. It is now generally accepted that there will be all kinds of uncomfortable coalitions after the dust has settled.
Locally, the foreign Europeans (plus a reduced number of other foreigners from some favoured nations) could make an upset on the local election results. If they could only organise and get together…! Thus a fearful article in Almería al Día.
‘Making me pay for my crimes would send a “message of uncertainty to the markets”: Bank President to Spanish Judge…’. Story about Rodrigo Rato and Bankia at Wolf Street.
The National Audience has exonerated the leading members of the CAM bank for ‘irregular’ payments.
‘Podemos isn’t going to let Andalucía go to the Socialists without a fight. The anti-austerity party has announced a €600,000 campaign solely to nurture support in Andalucía. Meanwhile the party has confirmed that MEP Teresa Rodriguez, from Cádiz, will be standing against current Junta president Susana Díaz in the regional elections on March 22…’. From The Olive Press. The PP candidate is Juan Manuel Moreno. Others include Antonio Maíllo (IULV-CA), Antonio Jesús Ruiz (PA) and Martín dela Herrán (UpyD).
RTVE has offered a live TV debate between Susana Díaz and Juan Manuel Moreno, after the Andalucian Canal Sur said they wouldn’t show one without the third party, the IU.
To keep everyone on their toes, there will be a Marcha de la Dignidad in Madrid (a giant ‘non-partisan’ ‘bread, job and roof’ demonstration) on the day before the Andalucian elections. More here.
Turns out that nude girl on the beach, as shown in some detail by the national TV, was not the nubile 34 year old Podemos candidate for the Andalucía election Teresa Rodríguez, but another. The politician is understandably suing the RTVE.
Is Pablo Iglesias from Podemos just a normal politician with a ponytail or is he the leader of a criminal organisation? The eccentric Manos Limpias is in no doubt and has made a complaint to the Supreme Court, who is now asking the Public Prosecutor to investigate.
The Real Debt suffered by Spaniards
Ángel Medina from El Indálico here.
At the end of last year, the Press stated that the rate of overdue payments had been dropping for fifteen straight months and 2014 had closed with just 12.5% unpaid debt, being one of the lower indexes in recent times. Of course, they were talking about debt to the banks on loans, and it may be true. However, they weren’t worried about normal people suffering evictions, thrown from their homes like dogs, or those starving so as to meet their mortgage payments. To them can be said: take heart my friends, the banks are doing better.
But real debt, those non-payments that so many families must make, that figure is not going down at all – indeed, quite the reverse. Now we see that our economists have either not noticed what is under their noses or at least, do not want to publish it, so as not to break up the euphoria of the Government’s apparently successful financial policies.
The reality is that there are very few people who today do not have debts of some kind: whether those who have failed to pay the IBI on time, or the garbage, or community expenses. There are those who have called for a postponement of the payment of the car insurance; while paying off credit card debt in part payments has become increasingly common. Many shops, bars and pharmacies are now opening customer credit accounts… And we could quote numerous further examples to show that poverty continues every day more and more despite the triumphalist announcements of the economic team of the PP.
And why? The answer is very simple.
Family income, which comes mainly from work, incomes or rentals; from bank deposits, interest payments, property speculation and State Aid, is still falling.
Wages have fallen: extra payments, overtime and the number of employees per family has also declined.
Furthermore, the money that went into households such as unemployment benefits, aid to dependants and so on has also been trimmed.
The owners of premises or homes that were paid rents have had to lower them – those who still charge their tenants anything, or who don’t have empty shops or apartments.
Bank deposits have gone from receiving a tiny interest to now paying account maintenance costs. Forget talking about those numerous bank products that have recently ruined many ordinary people.
Stories from the stock market are hair-raising: Telefonica decided (with the approval of the National Securities Commission) to forego distributing dividends. A wretched piece of chicanery that left ten million shareholders without receiving some money which they had, no doubt, already budgeted on paying off something they owed! The interest payments never came through! But it was the big banks following this example, after its managers had stolen money hand over fist from their customers, who decided to pay out dividends in shares (surely one of the greatest ideas of that old scamp Botín when he was President of the Banco Santander).
And not to mention those who have been forced to sell a property, after long and patient dreams about its revaluation only to find its value down 50% from when it was bought.
It is clear that family incomes have dropped severely and continue to fall.
On the other hand, costs continue to climb: taxes (both indirect and direct); official fines of all kinds (especially from the traffic police); gasoline (although there is now a brief and watered-down respite on the prices), electricity, water…
The balance of the family budget gives rise, in the majority of cases, to red numbers. The end of the month is a long road to travel.
And in a few months time, when those debts finally fall due, when the building communities flood the courts with small-claims, when insurance companies can’t pay out due to the scarcity of resources… a second recession will come along that will add to bank defaults to beat once again all previous records.
More cuts? More austerity? Higher taxes? More evictions?
Let us see how much longer the General Public will put up with this situation.
As forecast in last week’s BoT editorial, the Tesla domestic battery will not be made welcome in Spain. Excess energy returned to the net will, inexplicably, be charged by the power companies.
What do other countries think of Spain? Apparently, it’s sun, bulls and crisis. See report and graphic here.
‘Researchers at the Universidad de Las Palmas de Gran Canaria (ULPGC) have published an article detailing how they believe that the smoking ban in bars and restaurants has not had a negative impact on the industry, and that other factors such as the economic crisis have caused greater problems for business owners…’. From The Leader. In reality, bars with terraces are doing well, bars without them, not so much.
Those migrants who attempt to arrive by climbing over the fence in Melilla: the award winning photo here. Contrasting this, here‘s another picture, of a Guardia Civil offering an immigrant stuck on the fence a bocadillo.
The new Ley de Montes allows forest land, razed by fire, to be immediately re-zoned. Hitherto, one had to wait thirty years (which must have put off some arsonists). No longer.
The most popular car bought by Spaniards under the Plan Pive, which gives up to 2000€ back against an old rust-bucket, turns out to be the Dacia Sandero, imported from Romania. You can get one new for about 4,000€. There is no similar Plan Pive in Romania (or any other EU country). Indeed, the Spanish version of the plan to encourage consumers to buy a new car, now in its seventh year, is currently stalled in the Council of Ministers. More here.
Hello, I am currently working on a new series for Channel 4 with the working title of “The Great Escapers”. We are looking to feature British people who have moved to both Spain to set up a new life. We are not just concentrating on those people who have retired, rather people who have headed overseas to start a new career or set up a new business.
We are looking to feature a mixture of people from a variety of backgrounds – probably in the Málaga/Marbella area of Spain – and at different stages of their moves.
We would like to meet people who are settled into their lives but also people who are either about to make the move or meet people with fledging business or as they first arrive in the country.
I would love to hear your stories.
A digest of this week’s Spanish financial, political and social news aimed primarily at Foreign Property Owners:
with Lenox Napier and Andrew Brociner
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Jose Antonio Sierra.