The CNMV Extends the Restrictions on Short Selling Listed Company Shares for another Month

The fallout from the coronavirus continues. The extension of the ban will take effect from 18 April until 18 May, and may be extended further.

The prohibition on carrying out operations that involve the creation or increase of net short positions of listed companies’ shares has been extended for one more month.

The decision was made due to “the persistence of the risks and uncertainties surrounding the evolution of the economy and the market in the context of the situation created by Covid-19, as well as the high level of volatility and the risks that could arise from disordered price movements”, explains the National Securities Market Commission (CNMV).

Ministry Of Dev’t: New Home Permits Soared By 17% In 2016

4 January 2017 – Expansión

Moreover, loans to build new homes have grown by 37%, despite the tightening of controls by the banks.

A decade later, the cranes are back on the skyline of Spain’s major cities once again. The economic improvement and return of credit to the property sector boosted the construction of new homes by 17% in 2016, according to the construction permit statistics published by the Ministry of Development.

The growth was driven by a 37% increase in the financing granted to construction companies and property developers, which received €1,025 million between January and October, according to the General College of Notaries. The banks have now digested the majority of the toxic assets left over from the bubble and are opening the credit tap to the construction sector once again, albeit including more restrictions and controls to avoid repeating the errors of the past.

On the one hand, in most cases, financial institutions are demanding that 80% of developments are pre-sold before the construction of any new buildings can begin. Moreover, the banks are requiring project monitoring to audit the execution of the work and, in the same sense, a more detailed control of the clients that choose to buy properties.

With the money loaned by the banks, property developers and cooperatives have started to design buildings aimed at capturing the demand for new homes that exists in the market. “Clients believe that the worst of the crisis is over and that prices are not going to decrease any further. Moreover, financing conditions for buyers are unique given the low level of Euribor”, explains Daniel Cuevo, Chairman of the Association of Property Developers in Madrid (Asprima).

But the doors to the new real estate market have not been opened to everyone. Most of the new homes sold are “reposition” properties, in other words, they are properties that replace homes that have become too old or too small for their occupants. Young people are finding it the hardest to form their own homes, due to the high rate of youth unemployment, the level of wages and the instability in the market. (…).

In total, during the first ten months of 2016, 16,043 permits were requested to build new homes. The sector expects to reach the 20,000 permit threshold by the end of the year, a figure that exceeds the number of permits requested in 2015 by 17%, but which is still well below the 113,000 permits requested in 2006, a record year, at the height of the real estate bubble. (…).

On the other hand, the new homes that are being built post-crisis are not the same as those that were built during the boom years. Now, property developers are designing buildings with three-bedroom homes that cost the same as a two-bedroom home back in 2006. Urbanisations, which become so fashionable at the beginning of the century, are also back in demand. “People want homes with padel courts and a swimming pool, plus they now also want specific spaces to celebrate parties for children and adults”, explains the President of Asprima. In total, the Ministry of Development granted 1,175 permits to build urbanisations in Spain during the ten months to October 2016.

The increase in property construction has been accompanied by more transactions involving land. The number of land purchases by companies recorded an average growth rate of 23% during the nine months to September 2016, across the country as a whole. In certain regions, such as Madrid, the increase during the first three quarters of the year amounted to 135%. (…).

The improvement in new build construction work also extended to renovations. Thousands of households took advantage of the economic recovery to undertake home improvements and even to extend their properties. Thus, during the first 10 months of 2016, 21,801 requests were filed to renovate or restore homes, up by 2.1% compared to a year earlier. Meanwhile, demand for permits to extend homes soared by 39%, to 1,634. (…).

Original story: Expansión (by Victor Martínez)

Translation: Carmel Drake

Cifuentes Abolishes Madrid’s 3-Storey Land Act

11 December 2015 – Expansión

On Thursday, the Plenary Assembly of Madrid abolished the section of the Land Act that prohibits the construction of buildings of more than three storeys, thanks to support from members of the PP and Ciudadanos and despite the opposition votes by members of Podemos and the PSOE.

Enrique Veloso, one of Ciudadanos’s members, who defended the draft Law for the modification of the Land Act in the Community of Madrid, said that the now abolished law “has done a lot of damage to town planning”. He criticised the fact that this restriction to construct only three storey properties was applied in a blanket fashion across all towns, without taking into account the characteristics of each municipality.

Ramón Espinar, member of Podemos, said that this partial reform of the Land Act “has circumvented the agreement” that existed between all of the parliamentary groups to draft a new Land Act. He added that the current PP is “the same as ever” and he criticised its rejection of a comprehensive reform of the aforementioned law, which “understood that land was being preyed upon as a resource”.

The socialist member Rafael Montoya declared that his party’s town planning model is “compatible with the interests of residents and is respectful of the environment”, and he confirmed that the abolition of the three-storey restriction “would not help to generate consensus”. He advocated a comprehensive reform of the current Land Act and he criticised Ciudadanos’s collaboration with the PP, stressing that both parties “form part of the same right (wing)”.

The PP member Diego Lozano accused Podemos and PSOE of abandoning the motion for the reformation of the Land Act and said that they do not understand “the urgency” of the need for a comprehensive modification of the law that was approved eight years ago.

Original story: Expansión

Translation: Carmel Drake