Tag: operations

Bankia Reduced Its Doubtful Loans By €2,000M In 2015

11 January 2016 – Expansión

The BFA-Bankia group reduced its doubtful debt balance by more than €2,000 million in 2015 through the sale of several loan portfolios. According to the entity, these operations allowed the bank to improve the quality of its balance sheet, raise liquidity and free up resources to grant new credit.

During the year, the bank completed four major operations involving the sale of loan portfolios with a total value of almost €2,800 million.

In May, BFA-Bankia agreed the sale of a portfolio of doubtful property developer loans amounting to €558 million to the fund Sankaty. Some of those loans were secured by real estate collateral.

A month later, the bank sold a portfolio of loans secured by hotel assets amounting to €383 million. The portfolio contained 91 operations in total, linked to 45 assets, and was sold to Bank of America and the investor Davidson Kemper.

In September, the bank closed the largest of its operations, by selling a portfolio of loans linked to the real estate sector amounting to €1,206 million, of which €986.8 million was secured. The purchasers in this case were the funds Oaktree and Chenavari.

In the last few weeks, BFA-Bankia has transferred a loan portfolio amounting to €645.1 million, all granted to the business sector and partly secured by real estate collateral, to Deutsche Bank.

Sources at Bankia highlight that, in order to maximise the prices obtained, a competitive process has been adopted for all of the portfolio sales between prestigious institutional investors and financial institutions.

Original story: Expansión

Translation: Carmel Drake

Housing In Q3: Sales Rise By 6.4% & Prices Rise By 2.2%

16 November 2015 – Cinco Días

On Friday, the property registrars published their real estate statistics for the third quarter of the year. According to the figures, prepared using data obtained from operations recorded in the registries, the changing trend in house prices that began in 2014 continued to strengthen during Q3 2015. The Index of Repeat Sales House Prices (based on the Case & Shiller methodology applied in Spain) recorded a QoQ increase of 2.2%. In the last year, prices have increased by 6.6%. The rate of growth in recent quarters is continuing to abate the cumulative decline recorded since the peak levels of 2007, which now amounts to 28.4% on average.

Registered purchases

One of the explanations behind the price rises is the trend in house sales. During the third quarter, the registrars recorded 92,786 operations in total, which represents the highest volume in the last ten quarters, and an increase of 6.4% compared with the second quarter. It also represents an increase of 16.6% compared with the same period in 2014.

“The cumulative YoY data for the third quarter confirms this positive trend, showing that during the last twelve months, 348,388 operations have been recorded, i.e. 13,255 operations more than the cumulative annual volume as of the second quarter 2015”, said the College of Registrars in a statement.

As usual, the distinction between new and second-hand homes explains this positive trend: there were 18,017 operations involving new homes, which represents a new historical minimum, with a decrease of 2.5% compared with the previous quarter. Meanwhile, there were 74,769 transactions involving second-hand homes, which represents a QoQ increase of 8.8%.

Purchases by foreigners

Each quarter, the registrars’ statistics analyse what is happening in terms of demand for homes by foreigners, however it does not differentiate between residents and non-residents. In any case, the operations closed by foreign citizens continued increasing in terms of their relative weight, to account for 13.5% of all house purchases in Q3 2015, above the 12.8% recorded in Q2, which means that foreigners made 12,000 more purchases in Q3.

By nationality, the British, who account for more than 23% of all purchases made by foreigners, are the clear leaders of this ranking. They are followed by the French (who accounted for 8.7% of all operations), the Germans (6.4%), the Swiss (6.4%) and the Belgians (5.5%). The Russians have dropped to ninth place in the ranking, accounting for just 3.4% of all purchases and confirming once again the downwards trend seen in previous quarters.

Mortgages

(…). In terms of new mortgages, the average amount loaned per home equals €109,744, which represents a QoQ increase of 2.09%. In the last year, this figure has increased by 4.6%, to record six consecutive quarters of increases.

Mortgage terms (durations) are also moderating, given that during the third quarter, the average term decreased from 23 years to 22 years and nine months.

On the basis of this data, the College of Registrars estimates that new borrowers are paying an average mortgage instalment of €531.86 per month, i.e. 0.02% less than in the previous quarter, which indicates, according to the experts, that access to housing is stabilising at optimal levels in terms of risk. In fact, this instalment amount represents 28.12% of wages, below the 33% threshold that the Bank of Spain considers is the optimal risk level for households when it comes to borrowing.

Original story: Cinco Días (by Raquel Díaz Guijarro)

Translation: Carmel Drake

Foreigners Spent €463M On Canary Island Homes In H1 2015

3 November 2015 – ABC

The real estate market is being revived slowly, but surely in the Canary Islands. Most of this growth is due to foreign residents in the autonomous region, which have spent more than €460 million so far this year buying homes in the region. To put this amount into context, that figure is the highest seen in the last eight years. In fact, for example, it more than doubles the figures recorded in 2009, when the economic crisis had already taken hold in Spain.

The demand for apartments and homes is recovering but at a slow rate. According to statistics published by the Ministry of Development, in 2015, and specifically in the six months to June 2015,  9,560 homes were bought and sold in the Canary Islands: 4,909 in the province of Las Palmas and the remainder, 4,451 in the province of Santa Cruz de Tenerife. This reflects an increase compared with the fewer than 9,000 homes that were sold during the same period in 2014, the fewer than 7,600 that were sold in H1 2013 and the 7,650 that were sold in H1 2012. A positive trend for the Canary Islands’ economy, which is strengthened by the fact that the size of these real estate operations is also on the rise.

Data from the Department led by Ana Pastor reveals not only that the volume of transactions signed (by buyers of all nationalities) between April and June (almost €588 million) is the highest quarterly figure since Q3 2010, but also that the volume signed during the first half of 2015 (almost €1,100 million) represents the highest figure since H1 2010. Between January and June, house sales in the autonomous region amounted to €1,069.4 million, of which almost €545.5 million related to operations in the province of Las Palmas and around €524 million to transactions in the province of Santa Cruz de Tenerife.

The bulletin from the Ministry of Development also showed that the recovery in the real estate market in the autonomous region has reached an important segment of the market, i.e. that comprising foreigners. Overseas residents in the region were behind house purchases amounting to almost €462.3 million between January and June. These operations totalled just under €210 million during the first quarter of the year and just over €252.5 million during the second quarter. The last time this figure exceeded €252.5 million was in Q3 2007, i.e., just before the onset of the subprime mortgage crisis, when it reached €261.3 million. If we take this latest half year data as a benchmark, the €462.3 million spent represents the highest figure spent by foreign residents in the last eight years, i.e. since H1 2007, the year that marked the end of the boom and the beginning of the long years of hardship. (…).

These statistics also show that foreigners living in the autonomous region prefer to buy second-hand homes. More than €417 million of the €462.3 million spent by foreigners, i.e. more than 90%, was spent on second-hand apartments and homes. (…).

Land sales not increasing

However, another indicator clearly shows that the recovery of the real estate sector is not happening as quickly in the Canary Islands as in the rest of the country: sales of land. The latest data from Spain’s National Institute of Statistics (INE) show that whilst during the 8 months to August, 48,905 plots of land were sold in Spain, up by 10.5% compared with the same period in 2014; the comparable figure amounted to less than 1.5% in the Canary Islands, where just 1,257 plots were sold between January and August, an increase of just 19 (plots) compared with the previous year. At the height of the boom, 5,800 plots were sold in the autonomous region during the same period in 2007.

Original story: ABC

Translation: Carmel Drake