Seseña, 8 Years On: 500 Unsold Homes In The Middle Of Nowhere

4 December 2015 – El Confidencial

(…). Seseña, whose name has been inextricably linked with the excesses of the real estate bubble, was the location chosen by Francisco Hernando to construct his property empire. But, in 2008, the real estate crisis erupted and the residential macro-project that he had designed collapsed right before his eyes. (…).

Since 2008, the year in which the crisis hit, 2,000 homes have been constructed in Seseña. All of them ended up in the hands of the banks. Currently, eight years later, and following aggressive price cuts by Banco Santander and Sabadell, the (unsold) stock has decreased by 75%. And, yet, there are still entire blocks of homes that remain unsold. Almost five hundred empty homes in the middle of nowhere, according to estimates made by the appraisal company Tinsa.

To give us an idea, there are currently 200 homes available for sale on the real estate portal, with prices ranging from €73,000, at the bottom end, up to just over €300,000, at the top end. Many of these homes are now owned by individuals, whilst others still sit on the balance sheets of the banks. Sabadell still have some units, although it is Aliseda (Banco Popular) that owns the most, given that the company chose not to adopt the aggressive pricing policy employed by its competitors and therefore, it did not manage to get rid of any of the homes it owns there. (…)

Vast amounts of stock across the whole of Toledo

Seseña is, without doubt, one of the most striking cases of the real estate excesses, but it is not the only one. The construction craze spread like wild fire across the province of Toledo, generating some very bizarre situations. Even in the capital, more than 4,000 homes have been constructed since the crisis hit, 25% of which have still not been sold.

Amongst the small towns in the provinces closest to Madrid, the municipalities in the north of Toledo have average occupancy rates of around 60% for stock constructed since 2008. In fact, despite first appearances, Seseña does not have the most concerning rates, given that the stock there is slightly below 25%, in line with the average for the metropolitan area of Madrid.

In the towns of Camarena, Alameda de la Sagra and Yepes, the percentage of unsold homes ranges between 60% and 70% of the stock of new builds. Hundreds of homes were constructed in these municipalities that nobody wants to buy now. Some projects were left half finished, littering the landscape of these towns. The vast majority of the unsold homes are owned by the banks. Heavily discounted homes that nobody wants anymore, in some cases, even if they are given away. (…).

We have spent eight years trying to digest this housing glut, with very disparate results depending on the geographic location of the stock. All indications are that the process (to digest the residual) is going to be slow in these municipalities and it is no wonder when we consider that prices are falling in the south of Madrid, so who would want to buy in one of these towns now?

Original story: El Confidencial (by Elena Sanz)

Translation: Carmel Drake