Summertime Blues

First viewing in weeks. An estate agent admitted to me the other day that this was the case. Want to know in how much of a trough the local property market is? Go ask a few estate agents. Don't ask those who deal at the luxury end (even if some of these are feeling the pinch when it comes to British purchasers faced with a poor exchange rate). Talk to those at the middle and low end. All those estate agencies that have closed, and nothing by way of an improvement in the market; it just gets worse it seems. Another agent told me of an apartment for sale in Puerto Alcúdia. Pretty good place, but a seriously overstretched owner who had hoped the summer rentals would suffice in order to pay the hefty mortgage, the sort of mortgage it would be hard to conjure up just at present. You can't even rely on the holiday let to bail you out. The Taylor Woodrow development in Puerto Pollensa, the one from the company with the "We Build in Spain since 1958" line; these apartments would once have all been snapped up off-plan. They haven't been. In Playa de Muro there is a development of detached houses - "in an extraordinary setting, clean beach and natural surroundings make this a veritable 7km paradise within your reach". This comes from the catalogue thing that was shoved under windscreen wipers at the weekend. It follows the appearance of several street posters pointing the potential customer in the direction. It's a building site. They want, sorry need, off-plan sales. The spate of publicity suggests a worry, perhaps more. Sell off-plan and the deposit and the virtual guarantee of a sale will help to secure further lines of credit from the bank. That would be the hope. There is another aspect to the property development uncertainty. It is the inordinately long time that it can take to actually finish the building. Given restrictions on construction work in tourist areas during the season, the time-scale between starting, beginning to sell off-plan, receiving deposits to final completion can be extremely lengthy. It only takes an economic crisis to invade that time-scale for the walls to come tumbling down. And this is what has been happening.

Martinsa-Fadesa, one of Spain's largest property developers, has collapsed. "The Sunday Times" carried this story yesterday, angling it from the point of view of the Brit purchaser who stands to lose a shedload. The paper mentions also an unfinished development on the Costa Blanca. There are probably many more. The problem now is that if a deposit is put down, it may never be recouped and the property may never be built. Martinsa-Fadesa has been hit by the double whammy of too much borrowing and therefore too much debt and a fall of up to 60% in Spanish developer sales.


Picking up on the reference to Spanair on 19 July (the airline is planning the axeing of a third of jobs), there is now also the news - carried by "The Bulletin" over a couple of days - that Ryanair is pulling its Palma service for a period this winter (from 4 November till 19 December). The company cites the cost of fuel and the costs of operating at Palma, this latter point being challenged by AENA, which runs Palma airport. Whatever the situation, Ryanair's decision hardly warms the already chilly winter scene. Winter flights they may be, but at present there ain't no cure for the summertime blues, though at the end of the month Balearics leader Francesc Antich is due to unveil a package of measures to assist the freezing local economy. I'm not sure we should be holding our breath.

Sorry, it's not great news today. I'll try and be more cheery tomorrow.


QUIZ
Yesterday's title - The Beatles, "A Day In The Life" (http://www.youtube.com/watch?v=gZez_k4vAzU). Today's title - who? Died at 21.

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