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As my family and I are on holiday, I skipped my usual half hour checking out the 24-hour news channel yesterday morning, and then spent the afternoon on the golf course. The weather was so hot, the golf so much fun and the after round drink a real pleasure. So when I got home, I ended up having a few glasses of ice cold water with the family on the terrace before falling into bed.
Today I awoke to a worldwide stock market collapse. Armageddon all over again it seems, absolute panic on the 24-hour news channel – boy, I bet the news guys got up with glee this morning – and it could well be that a whole load of bankers may not be getting their bonuses this year. Except for those who somehow make money out of pushing down the market.
And, yet, instead of joining in the panic, doom, gloom and desperation I just thought… so what? We used to be worried sick about the stock market in our office, checking it almost hourly and looking at exchange rates all day long. We digested every financial bank report on our market, and analysed every economic study into why and how the world as we knew it was about to end.
And we got so tired of it all. People carried on buying property every day, not in the boom time numbers but certainly enough to keep us all more than busy, and eventually we seemed to have just got past the hype and manic mass panic that comes with every pronouncement of worldwide economic collapse.
BOOM TO BUST, WE’VE BEEN THERE…
Not that we don’t think it’s real, or are oblivious to all the austerity and hardship, We’re not that stupid. But we saw the Spanish real estate market boom from 1999 to 2004, and we knew from day-to-day experience that it was dying off in 2005, a fact that become official by 2006 as prices peaked at levels that were unsustainable. So, after a 5-year boom, we’ve now been in the doom and gloom business for 5 years too.
But… the sun keeps shining and Málaga airport is packed to bursting with visitors. Our infrastructure – built over 50 years – is paying huge dividends in comparison with other venues and the Costa del Sol continues to be Europe’s favourite destination.
The Coast has paid the price for its overblown success, hard lessons have been learnt and, well somehow, you know….a worldwide stock market collapse sounds pretty good to us.
One way or another we’ve all lost money on the stock markets over the years, whether in individual stocks or our own pension plans. It’s been a terrible time to invest, but people are coming to us in greater numbers every month now. Interest in our market is massively up… and why?
A WHOLE NEW DYNAMIC
It’s easy really. Real estate is a long-term investment which produces great returns despite the vagaries of the market. Real estate is also a get rich quick scheme in boom conditions. And if you put those facts together with the reality that the Costa del Sol has had the all-time battering of its life in seeing up to and sometimes even more than 50% falls in property prices – then it creates, all on its own, with no push from us – a whole new dynamic. It is, I suppose, day following night.
What is someone to do with their money today? Go to the stock market casino again and bet on black? Or do you buy at the bottom of the market, a property that’s guaranteed to be a great long-tem investment? Do you use interest only finance, or even 100% finance whilst it is available? Do you pay the whole sum if you have it available? Then sit awhile on that investment – we all have to sit awhile on any investment. That’s why we care two hoots for a stock market collapse.
ENJOY YOUR INVESTMENT
We’ve come to realise that no matter who is buying or how, they are doing so today in our market. They get to sit on their investment – literally. They get to look out over the Mediterranean, sip a glass of red wine on the terrace, with the distant sound of the 24-hour news somewhere in the background, and know that now they will have real, steady and long-term growth. They’ve bought in the best buying conditions ever known. They’re not at the mercy of city suits, no politician can close down their investment – it’s good old bricks and mortar, wholly owned by one shareholder who makes all the decisions and happens to get a lot of pleasure in the process.
I’m not playing golf today, but I am twice over the weekend. The world continues to be a pretty screwed-up place these days, but we’ve been through so many days like this that I’m no longer worried. In fact, like I said, I think this was a pretty good day for Spanish real estate.
Vlaams-Nederlands
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The opinions and comments expressed by contributors to this Blog are theirs alone and do not necessarily reflect the views of VIVA Homes Under the Sun Ltd, any of its associated companies, or employees; nor is VIVA to be held responsible or accountable for the accuracy of any of the information supplied.
Greig HayesAugust 8, 2011 at 5:01 pm
Couldn’t agree more. My father, 30 years at the FT, still has a lot of investment on the stock market unfortunately. But I can tell you one thing, as he sits in his villa on the other side of Málaga knowing that he purchased it for 30% less than its market value, another market crash is the last thing on his mind. The money spent on the villa would have otherwise gone back onto the stock market or sat in the bank, but buying property is simply the most savvy thing to do in circumstances like this.
Greig HayesAugust 8, 2011 at 5:01 pm
Couldn’t agree more. My father, 30 years at the FT, still has a lot of investment on the stock market unfortunately. But I can tell you one thing, as he sits in his villa on the other side of Málaga knowing that he purchased it for 30% less than its market value, another market crash is the last thing on his mind. The money spent on the villa would have otherwise gone back onto the stock market or sat in the bank, but buying property is simply the most savvy thing to do in circumstances like this.
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