Spanish Property

United Kingdom

2009-06-30T07:43:00.000-07:00

Scanning through some newspapers this morning I saw on the front page of the Daily Mail a high profile model lying in the gutter outside a night club with blood all over her dress and face. Apparently she had been assaulted inside.
Police say that these ‘laddettes’ now create more violence in their drunken orgies on Friday and Saturday nights than their male peers.
This appears to be a manifestation of a complete breakdown in British society where nobody appears to have any respect for anything or anybody including themselves. Leadership is all about example and perhaps, if we look at our leaders of both church and state, we can readily see that there are very few of these high profile stars that merit respect for their leadership qualities.
Higher unemployment as a consequence of this over dramatized economic crisis will inevitably lead to more violence on our streets. It is almost self perpetuating.
We will return to this topic later.
Gerrygalvin1@gmail.com

Economic Pain in the EU

2009-05-05T03:06:00.000-07:00

In a recent report, EU officials say that Europe’s economy will shrink by 4% in 2009 and stabilize in 2010. The Irish economy is predicted to shrink at twice this rate in 2009 and possibly at a rate of 2.5% in 2010!
The two economies worst affected, in the EU, are likely to be Ireland and Spain both of which experienced unsustainable construction driven booms.
Average unemployment this year is likely to be about 10% in the EU while unemployment for both Ireland and Spain is likely to reach a peak of up to 16% by 2010.
Before it levels off, the Irish budget deficit is likely to peak at 15% of GDP and the country’s debt could potentially reach 80% of GDP by 2010: an increase of a factor of three in two years!

Moral: It would appear that the most ‘target rich’ environments for investors in the EU, just now, are likely to be Ireland and Spain with the latter, particularly Tenerife, having a unique climatic advantage!!

Gerrygalvin1@gmail.com

Pandemic

2009-05-02T00:52:00.000-07:00

Once again the 'experts' have thrown the world into a panic with their terrifying, uninformed, prognostications. On May 2, 2009 there is no data to support these scare mongerers. From many governments viewpoints this topic provides a welcome respite from economic doom and gloom.
However, there is a lesson to be learned from this. The lesson is that we must revert to traditional sanitary and hygiene measures and careful crop, animal and fowl management. Over intensive production of either crop or animal inevitably leads to promlems as indeed do all man generated activities in conflict with the natural order.
From an investment point of view there is a warning not to put your toe into undeveloped waters i,e. not to invest in locations with a poor infrastructure particularly with a poor or non existent sanitary system.
Ciao
gerrygalvin1@gmail.com

Dubai

2009-04-23T06:51:00.000-07:00

One of the phenomena in recent times, in the world property arena, has been the rush of the beautiful super rich into Dubai. This lemming like rush is being driven by film stars, footballers, bonus laden city bankers and the like.
A dictatorship governed by Sharia law, at the bottom of its oil resources is creating an artificial world from which it hopes to live on in the future…in the style to which it has become accustomed.
The Burg Dubai is already the world’s tallest building and still growing.
The Dubai Mall is the biggest shopping mall in the world.
The Burg al Arab hotel is marketed as being the best and most luxurious on the planet.
Dubailand is the world’s largest theme park.
We are to have golf courses and a Formula 1 race track plus plus!
We are talking about what is currently the biggest construction site in the world with many projects being ‘manufactured’ on man made islands off shore.

For Europeans one is talking about living in a soulless, overpowering, concrete steel and glass alien environment.
Do such people have rights in such an environment?
If, as we must believe, sea levels are rising what happens to the Palms and its brethren?
How are foundations designed and calculated for say a ninety storey building in such geological conditions?

Gerrygalvin1@gmail.com

Resumption of blog after a long lapse

2009-04-21T07:59:00.000-07:00

Much has happened since our last blog. We have closed down the office of PCI-International and the writer, Gerry Galvin, is now operating from home in Playa de Las Américas, Tenerife, as a sole trader (Irish Estate Agent and Property Consultant) with new contact details including a new e-mail address:
gerrygalvin1@gmail.com
Talks of economic crises have become somewhat depressing and, fortunately, there is already evidence that we have hit the floor and from that platform things can only move in one direction: upwards; albeit slowly. Tenerife particularly retains it's magic and with more adventurous investors, who drifted further afield, potentially if not actually in for a 'scalding' I believe that it will become even more popular as an investment destination as time goes by.
Life goes on. La vida sigue.
Watch this space!!

Lies, damn lies...

2008-09-01T02:33:00.000-07:00

The UK residential market has dropped by 10% Not true.

This is merely the alleged experience of one mortgage lender.
In fact the average drop over 10 selected areas from Cornwall, through Blackburn to Peterborough, to date, has been 4% - a rather large difference.

The source for this statement is the Land Registry that records the sold price for every property in England and Wales. This source is clearly unassailable. Therefore why talk ourselves into a crisis that should only be a correction of an over-heated market?

When everybody is panicking and rushing to market perhaps the time is coming to switch into buying mode! The lemmings never fail to provide scavenging opportunities for the savvy market watcher.

UK Market. Encouraging signs.

2008-08-05T00:40:00.000-07:00

The Centre for Economics and Busines Research predicts that the UK house market will bottom out within at most six months and prices will probably rise by 30% during the following three years. This supports the views of the National Housing Federation expressed last week.
The reasons are basically simple:
Very litle construction is taking place at the moment and demmand is beginning to outstrip supply; driven particularly by such groups as divorcees and immigrants,. In the medium to long term, market fundamentals do not change.
Now is a good time to buy both in Tenerife and in the UK not least from plans where you contract at todays fixed prices and have a potential 30% gain before closure date!
Furthermore, there is also a liklihood that the B of E will cut base rate of 5% to possibly 4.25% early next yeart if not indeed later this year.
Overall, the market is very much inclined towards the buyer now.
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Tourism 2008

2008-07-31T00:57:00.000-07:00

The tourism authorities in Tenerife are quietly optimistic that in 2008 we should at least equal the number of tourists for 2007 i,e 5.200.000. Hence there is some reason for reiterating that the crisis that is confronting us every day in the media is more psychological than real.
The 'Hoteleros' complain about illegal competition from the private rental market and from the smaller hotels that are nor fully authorized for tourism.
Tenerife enjoyed 2.616.454 tourists for the first half of 2008.
Let's not talk ourselves into a crisis. Tenerife remains one of the better and safer places in the world either to live, work and invest in or to enjoy a few weeks vacations.
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Siam Park Update

2008-07-18T02:36:00.000-07:00

The Park looks just about ready to roll now and it may be worthwhile to monitor their site that is now being regularly updated.
It will certainly bring a new dimension to Tenerife that will host at least as many tourists as last year.

http://www.siampark.net

Tenerife : General news snippets

2008-07-16T00:48:00.000-07:00

House prices in Tenerife
It may surprise a lot of people that houseprices in the Canary Islands have increased by 2,8% on an annual basis up to 30/06/08. This accords with informatioin provided yesterday by the government.

The Euro
This was always an economic concept driven politically on the grounds that one size fits all. Now, countries like Ireland need to inflate their economies either by increasing borrowing or printing more money. Under the regime of the Euro they can do neither. So euro governments are left without any macroeconomic controls. Menwhile Ireland has to cut health spending while, as a net contributor to EU, our taxes go to subsidise Rumanian farmers. By contrast both the UK and the US being non Euro countries allow their curencies to fall reflecting internal purchasing power. That is logical.
Ireland is not unique in this sense. Should we think the unthinkable and consider dropping the Euro?

Tenerife: Traffic and other problems

2008-07-15T02:03:00.000-07:00

Some problem areas and how may we resolve them!
Traffic:
History has demonstrated very clearly that merely building more roads does not solve the problem. Indeed it tends to exacerbate it. Apart from using huge chunks of a limited stock of land the construction of more and faster roads merely attracts more traffic. Public spending is generally very welcome by the electorate and is obviously hugely pleasurable for the politicians. Indeed politicians everywhere become quite orgasmic when they have ‘loads of money’ to spend! However there is another side to the coin. That is to reduce the level of traffic. This may be accomplished in a number of ways:
• The obvious, if not the least painful, solution is to reduce the number of vehicles. This at the end of day means higher taxes on vehicles, on road usage and or on fuel. Clearly, as an alternative to private transport, there must be an efficient system of public transport. Nobody wants to pay higher taxes but it’s a question of balance and the common good!
• Decentralisation of services and centres of employment could reduce the number of journeys and alleviate congestion! Does Tráfico and La Oficina de la Extranjeria have to be in Santa Cruz? Why do all driving tests have to be undertaken in Santa Cruz?
• Instead of constructing more and more ‘traffic attracting’ roads in order to bring workers to the centres of employment, would it not be immensely more sensible both economically and socially to bring the jobs to the workforce? Why not, for instance, designate one million square meters of land in the Santiago del Teide\Buenavista del Norte zone as a ZEC (area)?

Is it practical for the Ayuntamientos in the south to object to the location of large stores such as El Corte Inglés or IKEA on grounds of protecting the PYMEs? Apart from the fact that it is like trying to stop the tide, the only way for the PYMEs to survive in the long term is to specialise in a product service mix with which the grand stores would be unwilling or unable to compete. Rather than being a general sports shop for instance why not specialise in one activity such as cycling, athletics or aquatic sports? The reality is that the consumer will, and does, drive from the South to Al Campo and Carrefour thus creating more traffic congestion and with no less adverse an impact on the PYMEs. Tourists from overseas also generally like to visit the destination, household name, retail stores without having to invest a day of their all too short holiday in congested travel.

Police:
There is a perception on the streets that there may be ‘one law for the locals and another for the foreigners’, whether such foreigners are residents or tourists. This is a perception typical of most countries by outsiders. From a marketing viewpoint perception is as important as reality. There may be a need for a better PR function at the police end. Many people believe that the police are far too eager to tow away cars for minor parking offences. Is it traffic control or income generation? Apart from the cost and stress involved for non Spanish-speaking tourists, they lose a day of their holiday. Does this encourage repeat visits? Perhaps a multi language warning or advice leaflet could be placed under their wipers for less grave offences especially where neither a traffic hazard nor an obstacle is created.

Furthermore, many foreigners are not accustomed to ‘gun toting’ police, wearing black glasses. They find it somewhat intimidating. Should all members of such security forces wear clearly legible identification numbers? Why shouldn’t members of the police be clearly identifiable? These are all perceived problem areas that would be relatively cost free to resolve thus making our island more tourist-friendly. After all, the police are on our front line of public relations as are the taxis, tourist guides and the estate agents. It is clear that those employed in these sectors should be fully aware of the importance of their role and trained on a continuous process to maintain the highest possible standards both of performance and integrity.

Perhaps our visitors do not consider that Tenerife is quiet as friendly (amable) as we would like to think. Our youth, particularly those engaged in the ‘office’ sector, do not always appear to be imbued with either a work or service ethic. They seem to be, as employees, particularly if the employers are foreign, very conscious of their rights but not at all conscious of their obligations. The words of John F. Kennedy may be worth quoting “Ask not what your country can do for you. Rather ask what you can do for your country?” Rights and obligations are merely the two side of the same coin. You cannot have one without the other. Nor can we as a state(let) dine a la carte at the table of Europe. If, on the one hand, we accept, nay, demand as our right vast amounts of structural funds from Brussels we cannot then for example start bleating about restricting the rights of fellow EU citizens to live and work here in Tenerife and share equally our rights and obligations.
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Spain: Foreign Investment 2007

2008-07-03T08:15:00.000-07:00

People may be astonished to note that foreigners invested more than €5bn in Spain during 2007 almost 25% more than in 2006.
This is certainly a strong vote of confidence in the Spanish economy. These figures were released by Banco de España
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Stockbrokers. Do we need them?

2008-07-02T01:52:00.000-07:00

The ‘poor stockbroker’!

A review of the Irish and UK stock market June 08. Compliments of P Murray.

Perhaps we should feel sorry for the ‘poor’ stockbroker – maybe we should put them on suicide watch – what other profession has written so many guidelines, recommendations and briefings that have been so spectacularly wrong over the past 12 months.
A doctor would be struck off, a banker fired, an estate agent bankrupt but such is their resilience that they continue unashamed and unabashed to write more briefing notes even as we speak.
Amazingly there are no anecdotal tales of stockbrokers going bust - how can this be? – do they do not read or act on their own notes?!

But just like the property market or the decline of the dollar, their demise, although slow, is in the very seeds they are sowing. Through their encouragement of market volatility through various devises including my pet hate - short selling- the market they represent is disappearing before their eyes. The hen that laid so many eggs is being eaten for a short term gain.
The credibility of the stock market as an efficient medium of capital is melting before our very eyes. Why should a Bank stock vary by 6% in a day or a food company vary by 5%? There is no information in the market that would suggest an adjustment to value. We have dozens of accountants and internal auditors within these companies worried over pennies – and rightly so – but why should they bother when brokers are moving the value of their companies tens or hundred millions. There is a total disconnect between the business and the shareholder.

Anecdotally the smart money has left the stock exchange years ago and is mostly invested in private equity funds. So are only the idiots left investing in the stock market?

It gives us no comfort that we are not alone. We cannot see the woods for the ‘hedges’.
We are surrounded by hedge funds. The classical theory is that they add liquidity to the market. My response is bull. I have a simpler economic theory – it is called a zero sum game – if hedge funds are making billions due to their activity in the stock market then it is at someone’s expense – yes indeed – yours and mine.

And keeping with my zero sum game theory if you keep draining a reservoir eventually it goes dry – and what we are watching is the collapse of capitalism as we know it. Well managed and funded companies are trading of multiples of three and four. The stock market is making a laughing stock of business. The solution has to be to take them private – which they would if the banking system was not currently dysfunctional and suffering from the same stock market constraints.

Looking further ahead – say 10 years – and it may even be closer – perhaps 5 years – the issues will be air, water food and energy. Interestingly many of the companies in this area are not listed. In twenty years time people will ask about the stock market and we will point them to where the Natural History Museum will house historic stock market reports – now collectors items – and the blenched white bones of investors who kept marching across the desert - ever hopeful.
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Tenerife. Quo vadis? cnt

2008-06-24T02:18:00.000-07:00

Ireland is a country whose experience we could usefully learn from. Here is a country, a relatively small island, which has transformed itself from a peasant society, the poor man of Europe, into one of the most prosperous countries in the world with no unemployment of any significance. In fact, while traditionally its main export was its youth, now Ireland has to import many thousands of foreign workers each year. This transformation, this economic miracle, has been achieved in the space of forty years i.e. in little more than one generation.
How was this transformation achieved?
There are many factors, the more important of which are listed below:
1. Number one is undoubtedly the high standard of education which has long been a tradition in Ireland (Ireland in this context always means the Republic of or Southern Ireland or Eire). The typical Irish mother with a typically large family couldn’t provide for her children in a material sense. But, though generally uneducated herself at least in any formal sense, she was driven by a desire to give her offspring the highest standard of education possible. This philosophy, in the short term, enabled Irish emigrants to achieve success and gain valuable experience overseas. More recently it has provided a highly skilled pool of labour that attracts overseas investment…not least from these very ‘emigrants’ now returning to their homeland.
2. Membership of the EU in 1973 provided a significant growth platform when the US, for historical as well as economic reasons, and Japan especially, invested heavily in Ireland which they used as a launching pad for their exports into the EU. Thus Ireland largely leapfrogged the ‘industrial revolution’ and surged straight from a primitive agricultural society into the high tech generation.
3. The fact that English, probably better spoken than in England, was the common language and
4. An attractive fiscal regime.
Tourism has also been a major factor in Ireland’s economic development over many years. It has a wonderful blend of scenery including mountains, rivers, lakes and forests and its entire marketing rationale is based on a philosophy of a Cead Míle Fáilte..one hundred thousand welcomes! The industry was originally ignited about fifty years ago by Yankees, descendents of Irish emigrants, returning to the Emerald Isle in a quest for their roots.

Furthermore, substantial EU structural funds were largely invested in infrastructure including transportation, telecommunications and education and professional training. The total package was actively marketed worldwide by a highly skilled entity: the IDA (Industrial Development Authority).
As a consequence of the foregoing factors, suburban Dublin and indeed Ireland generally has become like Silicon Valley phase two. Microsoft has its largest European R& D center there. Dell has its largest assembly and European distribution center in Limerick. Intel manufactures its processors there. The custom built Dublin Financial Services Center is in the global league etc. At this time there is no significant unemployment in Ireland. Because it is a relatively small island and with many cultural similarities to Spain generally and Tenerife specifically it appears reasonable to assume that we could learn a lot from the Irish experience. The fundamental dynamo generating this economic miracle has been and continues to be a very high standard of education and continuous professional training.
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Residential property market in Spain

2008-06-23T08:50:00.001-07:00

Spanish government minister for housing Beatriz Corredor says that there are 600000 empty houses in Spain with demand running at 450000. She believes that now is an excellent time to buy as prices will inevitably rise at least in line with inflation.
Certainly property in Tenerife has never been more attractive as an investment due to the same supply demand imbalance.
She believes that house prices this year will rise at least at the rate of inflation.
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What if?

2008-06-19T04:14:00.000-07:00

What if the price of oil were to increase to 250$ a barrel? Could it change the entire concept of transport by road and indeed our entire philosophy toward road building or more specifically the construction of more and more new roads?
Europe generally can still be held up to ransom by the oil producing countries. The current rate of exchange €/$, the currency in which oil prices are dealt, is about 1,50 (dollars to euro). There is an argument that the rate should be more appropriately at a level of 1,20 (i.e. 1,20 dollars to the euro). That adjustment alone would raise the prices of petroleum in the euro zone by about 30%. At the end of the day, rates of exchange should be and must be determined by the internal purchasing power of the respective currencies and not by any artificial mechanism.
There are many factors to be taken into account such as the balance between storage and haulage i.e. the relative advantages of JIT: just in time delivery of products to outlet. Planning; both town and manpower planning are critical.
What are the implications for development and property in this scenario?
Are there too many of us already living on this planet, at 6,675billion?
What would Thomas Malthus think?
Is this scary pace of growth of the human species the real problem that we must sooner or later confront and resolve - peacefully?
Answers please to:
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Tenerife. Quo vadis?

2008-06-18T03:22:00.000-07:00

B5) If we accept that five million visitors is just about or above saturation point for the island, beyond which diminishing returns set in, then it appears difficult to justify the construction of a second runway at airport south!

Streamlining of services, continuous professional training at all levels together with the implementation of Operations Research techniques (at both airports) should prove sufficient to cater for any occasional peaks! Perhaps instead we should consider the creation of a third level educational facility in (say) Adeje. This business school, this embryonic university, this research and development centre, should ideally have some link with Harvard or Princeton thus ensuring world-class prestige and standards. Its brief should be to design and implement courses such that graduates would emerge every four years or so with an entrepreneurial instinct oriented towards self-employment and indeed employment creation. Certainly they should be ready to successfully seek senior executive positions at home or overseas. Such courses, it is reasonable to assume, would have in their ingredient mix languages, (including English) marketing and information technology. We are talking about a centre of business excellence with our future leadership being educated rather than being taught. Perhaps we already have the foundation for this school of excellence in Adeje with CDTCA!

Shifting the Car Ferry facility from Los Cristianos to Fonsalia would appear to make sense both from the operators’ viewpoint and from the point of view of the business sector in Los Cristianos. The town appears to gain little from this activity and it may be more beneficial for it to develop and grow as a recreational port with much reduced ‘heavy’ traffic!
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Ireland Speaks

2008-06-16T00:28:00.000-07:00

Perhaps we should digress from Tenerife Quo vadis? for a moment, to recognise the momentous rejection of the 'treaty' by the Irish electorate.
Although instructed and threathened by both local and international policitians to vote positive the electorate were not confused and stuck to their guns.
They we unhappy about such issues as immigration, taxation, abortion and sovereignty. The Celtic Tiger was constructed on a low manufacturing tax regime and there were fears that if this incentive were to be removed, in an harmonisation gesture, their would be undesirable consequences.There was a general, growing fear of big brother, of accountability going further and further away to the point of non existence.
The Irish are a small proud nation with a painful history. They are anxious to retain theire national culture and heritage. Perhaps there is an important lesson here for the rest of europe!
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Tenerife. Quo vadis? Cnt.

2008-06-12T00:49:00.000-07:00

Blog 4
The general point being made here is that with regard to most developments, particularly in the south of Tenerife, any conformity with established principles of Town Planning would appear to be purely coincidental. We continue to build beehives and rabbit warrens that, almost by their nature, are visually unattractive. There is over intensification of development, developments out of scale with their sites and out of empathy with their immediate environment leading to adjoining projects literally screaming at each other…and at the passer-by, including the tourist! More often than not there is no overall design brief to which all the individual components should conform. Walking through some of these development ‘mixed salads’ one can easily imagine the frame of mind of the Norwegian Edvard Munch as he worked on his famous creation: The Scream. In fairness this is phase one of Tenerife development where pressure of demand has forced us to sacrifice quality for cuantity.
This man made environment is an intrinsic part of the Tenerife marketing package and is further diminished by the huge number of unfinished buildings and projects.

The fundamental question of accessibility leads one to reflect on the ‘holy trinity’ aspiration of the Tenerife ‘Movers and Shakers’: completion of the Ring Road, construction of the Granadilla Port and construction of the second runway in Reina Sofia. Perhaps the shifting of the car ferry facility from Los Cristianos to Fonsalia should also be added. No doubt the technical people at island government level have appraised, ranked and prioritised all these major capital projects, together with alternative fund deployment opportunities, using, inter alia, DCF techniques including NPV and IRR.

One wonders if, rather than closing the ring road, we shouldn’t consider, in conjunction with the decentralisation of existing employment centres and the optimum location of new employment centres, the construction of a railway from say Los Olivos in Adeje to Icod de los Vinos; feeding Santiago del Teide, Buenavista del Norte, Garachico, etc in transit. This alternative transportation system would have the advantages that:
It would be much faster and cheaper to construct; much more cost effective.
It would create little environmental damage and certainly wouldn’t leave yet another malignant scar on an already heavily haemorrhaging landscape.
It could in itself be a tourist attraction, a ‘must do’ in Tenerife, and would be a delightful way to enjoy the stunning scenery along its proposed route. How can one savour the visual delights of this magical island if careering around an endless motorway at 120KPH? Needless to say we are not talking about an AVE type train system.
If, on the other hand, we wish to use the proposed ring road section as a platform from which to extend development around the island then…that is a political decision.

The construction of the Port in Granadilla would appear to be a worthwhile proposal in principle due to its strategic location. The fact that it adjoins a potentially major industrial estate and employment centre with its REF\ZEC implications is another plus. Such a project would presumably also provide the opportunity for Santa Cruz to develop as a recreational port particularly in the sense of attracting more cruise ship activity. Santa Cruz is a beautiful city, largely unknown to tourists, that has yet to exploit its many attractions. However, if the Santacruceros wish to continue enjoying their siestas and long weekends, while affluent cruise ship clients ramble the streets aimlessly, then that is their privilege. They shouldn’t wonder if the number of cruise ships ‘parking’ near Plaza de España decline. More friendly and welcoming ports are easily found. Whether ‘Port Granadilla’ has the potential to become an international transhipment hub – Plataforma Logística Internacional - linking three continents, is a question to be determined by elaborate marketing research and not justified solely by a hunch, a dream or indeed by having the imprimatur of a mercenary, however distinguished, such as Bill Clinton. Prima facie there is a case to be made for this project. Extreme care would have to be taken regarding both the nature of cargo being transported through Canarian Waters and the quality and suitability of the transportation vehicles.
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Tenerife: Quo Vadis? cnt

2008-06-04T06:27:00.000-07:00

The fact that Tenerife is by its nature a magical island, with most of the magic being generated directly or indirectly by Mount Teide is not open to debate. It is simply an indisputable fact, literally written in stone. Therefore in principle we have a fabulous product to market and that is the wonderful, indeed the unique, island of Tenerife. However, in order to optimise its potential, Tenerife must be marketed as an entity, as a whole, not just any specific part of it.
While the natural environment is special, the man-made environment in Tenerife is somewhat less so. It is not quite so impressive. Perhaps if we look at this man-made environment against the yardstick of internationally accepted town-planning norms we may begin to see why generally it doesn’t do justice to and match up to our unique natural inheritance.

Arguably nobody has improved on the definition of Town Planning enunciated by the late Professor Lewis Keeble, in his ‘Principles and Practice of Town and Country Planning’, almost forty years ago.
The art and science of ordering the use of land and the character and siting of buildings and communication routes so as to secure the maximum practicable degree of economy, convenience and beauty.
From this definition some fundamental principles of successful Town Planning emerge:
The promotion of accessibility; accessibility of homes to work, shops, schools and entertainment, of industry to sources of labour, power and raw materials and so on. It would hardly be going too far to call Planning a study in accessibility.
The employment of resources as economically as possible, so as to achieve the greatest possible measure of improvement with necessarily limited means.
The separation of incompatible land uses from each other and the association of compatible or mutually helpful uses and finally.
The carrying out of all development in as visually pleasant a manner as is practicable.
Planning, in a general sense, may be defined as the predetermination of a course of action. Perhaps, in a democratic society, we should be talking about Planning by demand. The problem here though is that conscious consumer wants are limited by experience and knowledge. By and large you can only want that which you know…what planners really need to know therefore, is what people would want if they understood on the one hand the full range of possibilities and on the other all the practical limitations.
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Tenerife. Quo vadis? Cnt.

2008-05-31T02:19:00.000-07:00

The first one is to have a continuous process of exit interviews, conducted by trained multilingual interviewers, in the departure lounges of both Reina Sofia and Los Rodeos. Here you have a willing and representative market sample in a situation of enforced boredom for anything up to two hours. These homebound tourists will be delighted to cooperate with the survey and get any grievances off their chests.

The second source of information is to ask the thousands of foreign residents, particularly those from the EU who live and work here, for their views. These people can be both one of our best sources of information and also our best ambassadors. Imagine the huge multiplicity of skills including languages and diverse experiences which such people as a body have to offer, at no cost...pro bono patria adoptada! Many of these ‘foreigners’ are very special tourists (resident tourists) in that they spend money here every day for several months each year and not just for a week or ten days! Should we not award these people VIP treatment? At worst, is it not better to have them inside your tent, looking out rather than outside looking in?

The fact that Tenerife is by its nature a magical island, with most of the magic being generated directly or indirectly by Mount Teide is not open to debate. It is simply an indisputable fact, literally written in stone. Therefore, in principle, we have a fabulous product to market and that is the wonderful, indeed the unique, island of Tenerife. However, in order to optimise its potential, Tenerife must be marketed as an entity, as a whole, not just any specific part of it.

Tenerife. Quo vadis?

2008-05-26T01:21:00.000-07:00

Tourism is the lifeblood of Tenerife. All of those fortunate enough to live and work in this magical island, drink from this elixir this life source, directly or indirectly.
Tourism is not in a crisis in Tenerife; not unless we make it so either by negative thinking or by identifying where we are as a problem rather than as an opportunity. The industry is merely at a crossroads where there are a number of alternative routes which we can select to launch ourselves successfully into phase two of our development, into a sustained trajectory of quality growth. In this phase two there must also be a continuous effort to identify and grow other sources of lifeblood; thus protecting ourselves from ‘contamination’ of this one arterial source. That is to say we must diversify and develop other employment generating economic activities.

Phase one, which has lasted for about forty years, is over. Enormous progess has been made even if, at times, quality has been sacrificed for quantity. We now have the opportunity to take stock, to decide where we have been, where we are now, where we want to go, where we should go and, last but not least, where we can go with the blend of resources available to us while being ever sensitive to the dynamics of the market place. This review should above all be a learning experience. If we don’t learn from the past we are doomed to repeat any errors that we may have made. Quality rather than quantity in every aspect of the term should be our motto and in this context perhaps we should accept that five million tourists is at or indeed above the level sustainable by Tenerife. It appears clear that at or near this figure the island is close to overload. There is overall saturation and diminishing returns set in.

Low cost airlines and an ever-expanding EU have transformed the tourism world. Furthermore, tourists are becoming more adventurous in their choice of destinations. Spiralling fuel costs may temper this sense of adventure and, indeed, may prove relatively advantageous to Tenerife.
Why would tourists come here rather than go to an increasing number of alternative destinations where they may enjoy equal or better facilities at possibly lower prices? Rather than trying to sell what we believe we have got to offer, perhaps we should ask tourists, both actual and potential, what they want and expect from us. This is probably the essential difference between selling and marketing. There are two simple and practically cost-free methods of acquiring this feedback, this very valuable marketing information. To be continued...
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Property in Spain, Tenerife

2008-05-20T00:31:00.000-07:00

Regardless of what stage of the economic cycle we find ourselves in, life must go on. We have to continue doing the normal things such as working, buying and selling; whether that be our weekly trip to the local supermarket or the local garage or builders providers. We must take the kids to school and meet our usual social obligations.
The property market must also keep moving as people have to change homes due to job change, promotion, emigration, family bereavement, retirement etc. Commercial property also will change hands due to expansion, downsizing, relocation etc
Things may happen at a slower pace or at a lower level but they continue to happen.
The show must and does go on!
info@pci-international.com

Irish Economy on 'way back'.

2008-05-14T00:54:00.001-07:00

'We are in a cycle and 2008/9 is the bottom of the cycle. We should be at the top of it in 2012.' So says the prestigious ESRI or Economic and Social Research Institute. Meanwhile with Ireland moving up the value chain it appears that there will be a decline in constructioin and manufacturing to be replaced by growth in the services sector, particulary in the financial arena, and managerial and professional positions will account for the major share of the jobs market.
Meanwhile the government should concentrate more resources on infrastructural development. All this is in line with recent commentary by the OECD.
There is growing evidence that the so called crisis in most European countries is less traumatic than the various gurus would have us believe. If Ireland and other well managed economies will be peaking again within three to four years, now appears to be a good time to seriously reflect on medium term investment.
One possibility in Tenerife could be to purchase now from plans, at fixed prices and experience at least a 50% growth in value during the delivery period. Tenerife is already spending vastly on infrastructure! Now is very much a buyers market. Consult a professionally qualified, registered and bonded estate agent, without obligation.
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Islands in the Sun

2008-04-29T01:24:00.000-07:00

While one of the main attractions for tourists and property purchasers to and in Tenerife is the consistently delightful climate; occasionally residents aren't quite as blasé. Just now for instance we are living with a calima: an extremely warm, dead, almost breezeless, atmosphere. This calima, that apparently originates in the deserts of the neighbourng continent appears to be dust laden and leaves both natives and tourists alike in a dehydrated state of semi permanent fatigue. The calima lasts generally about two days.

Lookin out now as I write this, there is brilliant sunshine and a clear view to the mountains and indeed Mount Teide at 3700M is visible.

However, this mild occasional discomfort is more than comensated for by an otherwise magical climate.

info@pci-international.com

Spain & Morocco, Strait Tunnel

2008-04-21T06:59:00.000-07:00

Possibly the next world scale civil engineering project will be the construction of the above. We have indicated in an earlier blog that Europe and the world generally, in its own interests, needs to help the states of Africa develop their economies.
One of the steps with this end in view could well be the construction of the above - probably a 20 year project. Current plan envisages a 39K tunnel linking the area of Tangiers to a spot in Spain near Tarifa. Approximately 28K would be under the ocean. Because of the instability of the ocean floor it is envisaged that this project would be much more difficult than the Channel Tunnel. However, Spain and Morocco appear to have reached agreement in principal.
Imagine the implications of being able to board a train in say Glascow and arrive in Capetown. What would be the implications for the Canary Islands and Tenerife?
info@pci-international.com

It's the Economy Stupid!

2008-04-16T08:30:00.001-07:00

During Bill Clinton's election campaigns this was his catch cry. It's the economy stupid! Certainly it appears that, during his many travails in office including a dramatic, sustained effort to have him impeached the, then, strong US economy held him safe.
There is another bitter election campaign being fought out just now in the US and it is likely that the US and indeed world economies wont settle down until this election is determined.
Both the Bank of England and Federal Feserve are toying with the idea of reducing base interest rates yet again. Such decisions are always a play off between economic stimulation and inflation control.
Whatever. People have to continue buying and selling. Vendors have to remember that, if they are buying as well as selling, their relative position is unchanged regardless of the economic cycle. They cannot expect to get 'boom' prices for their existing homes and purchase their new homes at 'bargain basement' prices. This basic common sense, if understood, will keep the market moving in a healthy way and the earlier property people take this fundamental reality on board the better for everybody.
info@pci-international.com

Spanish Economy 2008

2008-04-12T02:48:00.000-07:00

Spain, of most of the major world economies has been least affected by the US generated sub prime - hipotecas basura - lending crisis. While, in the normal cyclical process, the ecomomy has de-accelerated slightly heading into 2008 the banks have had substantial profit increases for 2007 and forwards:

Banco Popular: 22.8% profit increase.

BBVA: 29.4% profit increase.

Banco Santander: 19.3% profit increase.

This trend was reflected in some of the major commercial groups:

Telefonica 43% profit increase.

Iberia 300% profit increase.

Union Fenosa 55.2% profit increase.

Hence Spain remains a very stable, soundly based, economy and, together with its islands remains a very attractive destination for investment funds. The Canary Islands particularly, due to their unique climatic and investment tax regime advantages, remain primus inter pares in any international context..

info@pci-international.com

Spain news snippets

2008-04-09T01:27:00.000-07:00

Train to South
The Tenerife Government (Cabildo) has again provisionally approved the proposed route of the train that will travel from Santa Cruz through the Reina Sofia Airport to Torviscas Alto, inland from Fañabé. Relevant information may be had from visiting www.tenerife.es/planes.

LRAU/Land Grab Law
EU members have held a two day meeting to discuss the growing concern about the use and abuse of this law. This has led to demolition of homes in Valencia particularly, Murcia and Andalucia. Purchasers were originally advised that their homes were totally legal but, apparently because of a combination of corruption and a new interpretation of this law, many people who bought in good faith are facing ruin.
MEPs have called for an immediate moratorium on demolitions so...we'll see. Spain cannot dine a la carte at the table of Europe.
It highlights once again the fundamental advice for potential purchasers. Let the buyer beware. Caveat emptor. Seek professional advice from qualified people such as APIs.
info@pci-international.com

Tenerife : General news snippets

2008-04-02T01:20:00.000-07:00

The weather on the 2nd April 2008 is typically beautiful here in Tenerife. While this is a low period in the tourist cycle the beaches are still crowded as are most of the bars and restaurants. This is a time of year when we welcome the more mature tourist, including retirees, many of whom already own property in this magical Isle of tenerife.
One blot 'literally' on the landscape is that there has been a strike by the waste removal contractors in Adeje for some weeks now. Rubbish is piling up and, apart from being unsightly and smelly, it will soon begin to attract rodents and all other types of vermin.

Let's hope that the problem is resolved quickly as this situation is neither pleasant for residents nor tourists and certainly doesn't help the otherwise magnificent image of Tenerife.

Ten years ago when people thought of Tenerife they thought of Los Cristianos and Las Americas. Now, apart from places like Puerto de la Cruz, both tourists and tour operators think in terms of a 50Km strip extending from El Médano through Las Americas to Los Gigantes.
Many of these areas are totally self contained including El Médano, Los Abrigos, Gold del Sur and Amarilla Golf, Las Galletas, La Caleta, Playa Paraiso, Callao Salvaje, Playa San Juan and Alcala right through to and including Los Gigantes.
So, when people talk of wanting to be in the centre, there are now several centres!!
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Government demolition of costa homes

2008-03-21T01:01:00.000-07:00

We read today that the Spanish government have placed up to 500000 home owners under threat of demolition for being constructed within 100M of the shoreline - regardless of whether they were constructed before the enacting of Ley de Costas 1988. Retrospective laws are always disturbing.

It appears that more than 500000 owners who reside along the coasts of Spain will be affected. About 20% of these are foreigners including many thousands of Brittish.

It highlights once again the absolute necessity of having proper professional advice before purchasing. Caveat emptor. Let the buyer beware. Astonishingly, most people retain an estate agent when selling but rarely when purchasing; when professional advice is most needed. We are not sure to what extent property in Tenerife may be affected. Certainly, before buying property in Tenerife or elewhere, please consult a professionally qualified, bonded and registered estate agent.
info@pci-international.com

Easter in Tenerife

2008-03-20T04:55:00.000-07:00

It is now Thursday March 2oth and the general business environment is quiet. Many businesses are either closed or will close before two PM to celebrate Easter. Weather is beautiful here in Tenerife and the beaches are thronged. Hotels are almost at full capacity something that augers well for 2008 as a whole.
It appears that the exotic places are drifting a little bit out of fashion and that the rapidly improving and upmarket going Tenerife is on its way for phase two of its development and quality slow paced growth; not just in number of returing tourists but in a multiplicity of new facilities.

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More Stock Exchange Turmoil

2008-03-18T00:41:00.000-07:00

Once again there is panic in the stock exchanges almost like that of 1929. Another major financial institution - Bearn Stears - appears to be in trouble and once again J P Morgan apears to be coming to the rescue.
This crisis appears to revert back to the Sub Prime lending scandal that manifested itself in July last year in the US. A scenario where banks lent money to parties that they knew didn't have the repayment capacity and then compounded the issue by packaging up bundles of these loans and mortgages and selling them on as investments to other financial institutions. Thus this virus spread throughout the international fianancial system.
All these highly qualified, highly paid, financial movers and shakers appear to lack one basic ingredient: common sense. They also seem to lack basic accountability for their actions; sometimes I think reckless if not indeed criminal..
Then the US economy has other burdens not least the 12 billion dollars monthly that the ill conceived war in Irak is costing! An unwinnable war that, added to their committment in Afganistan, is worrying. Perhaps it's time to consider the legalisation of drugs but; more of that anon.
It highlights once again the volatility and indeed intangibility of the stock exchanges. It highlights once again that with property purchased at a reasonable price, in the prevailing market conditions, one can rest easier at night. Now may be the time to invest in bricks and morter.
info@pci-international.com

Siam Park Update

2008-03-13T01:29:00.000-07:00

Finally we have a definite opening date for this unique project. It is May 1, 2008.
Siam park is going to be the biggest aquatic theme park in Europe and, at a cost of 50 million euros, why shouldn't it be!

Apart from scary aquatic attractions including a huge wave area there will be five restaurants, aligators, sea lions, huge waterfalls, a meandering river and a Thai theme village.
This is just another stage in the continuous upgrading of the magical island of Tenerife.
Yet a further incentive to invest in Tenerife to live at least part-time in Tenerife!
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Random comment...

2008-03-12T01:20:00.000-07:00

In Spain the general election is now over and the PSOEs are in negotiation with various small parties to meet their shortfall of seven seats that would provide an overall majority. They have 169 and they need 176 since the total number of seats is 350. It is unlikely that this will be a problem for the PSOEs who can then settle down to their second four years in government. Mariano Rajoy is quoted this morning as saying that he has no intention of stepping down as leader of the main oposition party: the PPs. Hopefully, Spain and its islands will now resume a steady rate of economic growth.
Meanwhile, the war in Irak is costing the US 12 billion dollars a month an outlay that is not helping the relative strength of the dollar in the international exchanges. Since oil is priced in terms of the dollar this also has international implications.
Generally, however, the fundamentals of most of the European economies are sound. Therfore, unless we talk ourselves into a crisis, there is no valid reason why there shouldn't be an uplift in demand in the near future. Certainly, there has never been a better time to invest in property in the magical island of Tenerife.
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Tenerife : general news snippets

2008-03-06T23:56:00.000-08:00

Tenerife over the past few days has been with a heat haze known locally as La Calima. Classical symptoms include a slightly overcast sky, intense bursts of heat and the impression of a light dust haze circulating above. This comes perhaps six to ten times in a typical year.
Early March is one of the lull periods in a tourist sense before the peak of Easter so eveything is relatively quiet. All quiet in the western front!
A local beauty has been elected Miss Spain 2008.

Spain is now gearing up for general election day that is next Sunday the 9th of March 2008.
New fiscal regulations, effective from this year, considerably lighten the inheritance tax and gift tax burdens.
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Spain, Tenerife

2008-02-28T07:00:00.000-08:00

It's general election time again in Spain. D day is March 9. This election is hard to call as the socialist led coalition government has generally presided over a rising tide, economically speaking, in Spain.

Arguably the first generation in modern times to have experienced democracy in Spain have had it good.

The PPs or Partido Popular who ruled the country from 1996 to 2004 don't appear as yet to have captured the inmagination of the electorate. We'll see.

Meanwhile, as is usaual, major decisions are being deferred until after D day. There is a feeling that, whoever wins, the economy is poised for stable growth. It may surprise a lot of people that, as some form of economic indicator, property in Tenerfie appreciated by about 8% during 2007. What recession! As suggested in an earlier post the market can talk itself into a recession.

Let's all be positive and see what happens. I believe that the future is bright.

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España va bien

2008-02-18T01:36:00.000-08:00

With increasing prosperity and economic growth during the last ten years or so mainland Spain, or the Peninsula as the Canarios call it, has become an increasing force both from a tourism and property investment viewpoint.

While growth is slowing down just now, particularly in the construction sector, it is anticipated that the Spanish economy will trundle along at no less than 3% growth annually for the next two years. Then it is reckoned that the economy will be again poised for take off. Spain is different. España es diferente.

It is entirely logical and to be expected that the mainlanders should holiday in the Canary Islands and purchase their retirement and holiday homes here.

The islands, particularly Tenerife, have everything to offer to the discerning tourist and, being part of the Kingdom of Spain means that the Spanish are spending their money in house something that makes excellent national economic sense!

There will be a general election in Spain on the 9th March next.

Now is certainly a good time for mainlanders and others to invest in Tenerife.

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Global Economy: Interest rates.

2008-02-07T06:36:00.000-08:00

With the latest drop of 0.25% by the Bank of England the major rates that affect us here in Spain and in the Canary Islands are as follows:

Base rates:

US: 3%

EU: 4%

UK: 5.25%

This general downwards trend should help restore confidence and reduce the lemming impact in the stock exchanges.

Now is the time to invest in real estate in Tenerife: obviously with an Irish Estate Agent.

Ciao.

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What crisis?

2008-02-06T06:44:00.000-08:00

Spain had almost 60 million tourists in 2007 the highest number ever. It is confidently expected that this number will be increased during 2008. Trends come and go but Spain and it's islands, particularly Tenerife, will continue to be in increasing demand. Invariably, property investers in Tenerife have already visited the island at least once as tourists.
The market is all about confidence and recently people have been talking themselves into a crisis without any real foundation for this prediction that sometimes can be self fulfilling. In Tenerife such places as:

Playa de las Americas.
San Eugenio.
Torviscas.
Fañabé.
Playa Paraiso and
Puerto Santiago (Balcon de los Gigantes!)

continue to be very much in demand. There is a short term surplus of supply over demand just now that make it a buyers market. This situation won't prevail for long, however, hence now is the time to purchase a holiday home or a retirement home or any other property investment in Tenerife whether it be a seaside apartment or a detached villa or a local: shopping unit.
The bank of England is likely to lower interest rates yet again in the very near future and the relative strength of the Euro is merely a short term phenomenon. At the end of the day the exchange value of any currency will be determined by it's internal purchasing power i,e. the state of health of it's ecomomy.
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Tenerife. Quality of life.

2008-02-02T01:55:00.000-08:00

Probably the people or clients that we have envied most over the years are the swallows. These are the retired couples who come to Tenerife on or about the first of October and remain here until end of March.
The Tenerife all year round climate enables them to:

discard their winter wardrobe.
dispense with central heating.
enjoy the freedom of the outdoors daily instead of being prisoners of the weather in the north European countries.

Many have purchased in the Playa de Las Americas area where they are within easy walking distance of all educational, commercial and sports and social facilities and, of course, the ocean and beaches. Sometimes these are the forgotten tourists since they live quietly, participate in local social activities and contribute in a significant way to the local economy. Perhaps they are more worthy of cultivation than the tourists who come for ten days or two weeks!
Towards end of Spring the swallows take off to their countries of origin and enjoy the grandchildren and the home summer weather. What a delightful mix that we are sure ads about five years to their normal life expectancy.
For happy and healthy retirement there are few places in the world that can match the magical island of Tenerife. Perhaps, even the snowbirds migrating south to Florida from Canada each winter may take note!!
pci-international.com

Fractional ownership

2008-01-30T07:15:00.000-08:00

Fractional ownership also known as part ownership is not to be confused with time share.

A typical scenario is where three friends or family members decide to purchase the freehold of a property jointly. Each absolutely owns the freehold of one third or other agreed part of the freehold. Among the advantages are:

less capital is tied up by each individual.
a larger or more prestigious property may be purchased than where the group purchase individually.

Clearly a usage and management agreement has to be drawn up by somebody, such as a lawyer, qualified to do so, setting out the rights and obligations of the individual owners. This type of agreement is well established and is not unlike the articles of association of a private limited company that sets out the inter-relationship of the individual shareholders (owners).
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Buy Tenerife

2008-01-29T00:55:00.001-08:00

The Irish investor has become a very potent force in the market place over the last five years and indeed much more adventurous. However these investors run the risk of being badly burned particularly in Turkey.
There is a development in Bodrum in south west Turkey: Orient Palace; where the Irish investor is alleged to have placed 30M€.
This project has been heavilly marketed with 'guaranteed rentals' among other very attractive features. We have, in an earlier post, given our views on guaranteed rentals.
In any event, the project has apparently ground to a halt with a multiplicity of financial and legal problems thus placing these investors in a serious risk situation.
This again highlights the dangers of entering unproven markets that have a different commercial culture and without, obviously, having proper professional advice.
Tenerife has been proven as a holiday destination, as an investment destination and as a retirement home destination with a full social infrastructure including health, cultural and all commercial and sports and social facilities. This is, of course, apart from guaranteed sun and beach!! Tenerife also enjoys a unique investment tax regime.
PCI is your Irish estate agent in Tenerife.
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Recession and opportunity...

2008-01-23T00:41:00.000-08:00

The stock exchanges, ever 'market psychology' driven beasts, have been panicking since the new year. I think that property in the short to medium term, is always a better bet not least because it is under your own control, is tangible, fullfils a basic need now and in the future and, unless there is a total global disintegration,will always be in demand. Most economies are much more soundly based than their stock exchanges would suggest.

Sometimes it is good not to follow the herd but rather to go against the trend. If one can sustain medium term holding costs the time to buy is when the lemmings are selling. Here in Tenerife; patricularly in Playa de las Americas, Costa de Adeje, Fanabé, Puerto Santiago, Los Gigantes and other well known holiday destinations in Tenerife that time is about now.

It is a buyers market. But 'caveat emptor' let the buyer beware. Follow professional channels at all times. There are huge bargains to be had now in Tenerife that will, within a reasonable time, produce very satisfactory gains. The savvy Irish and, indeed, the Russian investors are coming!
We, at PCI as the only fully qualified, registered and bonded, Irish Estate Agents in Spain are ready!!
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Carnaval: S/C de Tenerife

2008-01-21T06:07:00.000-08:00

The theme for the 2008 Carnaval is 'magic'. You need to learn some new words to understand the Carnaval

Coso: This is a street procession.
Murga: A singing group, the members of which have written their own lyrics that are usually critical of local politicians or local well known personalities.
Comparsa: This is a dance group made up usually of friends or family who wear stunning costumes a la Rio de Janeiro.
Rondalla: Similar to the murga but with somewhat more gravitas!
Entierro de la Sardina: The burial of the sardine - a huge paper version - reflecting the mourning that comes from the ending of yet another carnaval. It has something of the symbolism of the singing of Pobre de Mi at the ending of the Fería in Pamplona.

When the carnaval ends in Santa Cruz it then moves on to Los Cristianos, San Isidro and Los Gigantes so there is no excuse!!
www.carnavaltenerife.com
During carnaval time is a great opportunity to look at property in Playa de las Americas, Los Cristianos and Fañabé since traffic is usually quiet in the south while the revellers are northward bound!
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Return to Siam Park, Tenerife

2008-01-19T00:24:00.000-08:00

Siam is the ancient name for Thailand.

Siam Park, described by its promoters as the new or second generation of waterparks will shortly be coming on stream in Tenerife south. Completion date has been delayed because the international builders and subcontractors, due to the uniqueness of the project, have had no prior experience. Opening date is now expected to be towards end of March 2008 and it will certainly prove to be a world class attraction to ad to those magnificent facilities already available in Tenerife. Watch this space!! Meanwhile visit:
www.siampark.net
Tenerife will be even more of a holiday maker's and investor's dream than ever before.

Meanwhile next month - February 2008 - the famous carnival returns to Santa Cruz. Apart from Rio de Janeiro this is apparently the biggest carnival in the world. visit: www.carnavaltenerife.es
By:

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Town Planning in Spain, Tenerife

2008-01-16T08:17:00.000-08:00

This concludes for the moment, our original blog on the topic entitled 'Town Planning: Demolition'.

Arguably nobody has improved on the definition of Town Planning enunciated by the late Professor Lewis Keeble, in his ‘Principles and Practice of Town and Country Planning’, almost forty years ago.
The art and science of ordering the use of land and the character and siting of buildings and communication routes so as to secure the maximum practicable degree of economy, convenience and beauty.
From this definition some fundamental principles of successful Town Planning emerge:

The promotion of accessibility; accessibility of homes to work, shops, schools and entertainment, of industry to sources of labour, power and raw materials and so on. It would hardly be going too far to call Planning a study in accessibility.

The employment of resources as economically as possible, so as to achieve the greatest possible measure of improvement with necessarily limited means.

The separation of incompatible land uses from each other and the association of compatible or mutually helpful uses and finally

The carrying out of all development in as visually pleasant a manner as is practicable.

Planning, in a general sense, may be defined as the predetermination of a course of action. Perhaps, in a democratic society, we should be talking about Planning by demand. The problem here though is that conscious consumer wants are limited by experience and knowledge. By and large you can only want that which you know…what planners really need to know therefore, is what people would want if they understood on the one hand the full range of possibilities and on the other all the practical limitations.
We may return to this topic later as it will certainly become more relevant to Tenerife and the property investment sector in Tenerife and the Canary Islands generally.

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Property in Spain, Tenerife

2008-01-15T00:49:00.000-08:00

Spain: Town Planning. Demolition!

Until fairly recently, any conformity with international Town Planning norms and building regulations in Spain generally and the coastal tourist areas, including the Canary Islands, specifically appeared to many observers to be purely coincidental.
Operation Malaya, phase one of which has just culminated in Marbella, provided a rude awakening for such observers. This was a judicial inquiry into town planning corruption that saw lord mayors, lawyers, notarios, police chiefs and promoters, among others, in prison. This town-planning control ‘virus’ is now spreading throughout Spain and its islands. The most recent manifestation was the very public demolition of a half million euro villa in the Alicante area of south west Spain just this week in January 08.
The problem appears to have been that, though the villa had the approval of the local town hall, such approval was in contravention of land use zoning i.e. it was built on rustic land. The town hall, for one reason or another, acted ultra vires. The buyers acted in good faith under advice from a local abogado (solicitor). Nonetheless, the Spanish government has determined that the villa is illegal and has clearly indicated that this home is the first of many ‘thousands’ to be demolished.
Caveat emptor! Let the buyer beware. A properly qualified, honourable, estate agent (API) wouldn’t have allowed a client to commit such commercial suicide. Estate agents should remember that, while the vendor from whom they may have derived over inflated fees may disappear to Botswana, or some such exotic destination, they also owe an obligation - at least of integrity - to the purchaser with whom they may have to ‘live’ for many years!

In our many years of experience in the property sector in Spain none of our clients have ever had a problem for the simple reason that we do our professional homework properly!
Everything, including shortcuts, is fine until something goes wrong!!
To be continued.

pci-international.com

Best known Resorts in Tenerife

2008-01-14T06:19:00.000-08:00

Tenerife tourist destinations.
Traditionally, the best known tourist destinations have been Playa de las Américas, Los Cristianos and the Costa del Silencio. Now there are a whole lot of new areas including:
El Médano: famous for its huge natural beach and wind surfing.
Palm Mar: a quiet cul-de-sac at the ocean’s edge between Los Cristianos and the Costa del Silencio.
San Eugenio: overlooking Puerto Colon. Here is the PCI office.
Torviscas: between San Eugenio and Fañabé
Fañabé: probably the most prestigious address in South Tenerife extending to
La Caleta: once a delightful little fishing village, now with wonderful sea food restaurants and a hotel.
Playa Paraíso: now a self contained ocean-side community with 5 star hotels, banks, shopping and entertainment.
Callao Salvaje. Ocean-side self contained village.
Playa San Juan: Ocean-side self contained village.
Alcala: Ocean-side self contained village.
Playa de la Arena; Puerto Santiago & Los Gigantes. Three in one village! These three delightful ocean-side villages link with each other terminating under the famous giants; Los Gigantes.
In any of these delightful locations you can buy holiday homes, retirement homes, apartments, villas, bars and restaurants together with hotels, golf courses, sites and land.
Pci-international.com

Tenerife: Problems and Opportunities

2008-01-12T00:43:00.001-08:00

All the indications are that 2008 will be a buyer's market in Tenerife; a veritable year of opportunity. The market has peaked. There is a surplus of supply over demand that will take about a year to absorb when the market is once again going to resume it's upward trajectory. Therefore if you have ever thought of :

buying a holiday home in Tenerife.

an investment property in Tenerife.

a villa in Tenerife.

golf in Tenerife

land in Tenerife.

an Irish, qualified, registered and bonded estate agent in Tenerife

then, now is the time to make contact with

pci-international.com

Tenerife: Post Christmas

2008-01-08T07:49:00.000-08:00

Tenerife is slowly reverting to normal life, commercial and otherwise after the Christmas and new year celebrations. Today; Tuesday the weather is beautiful and the beaches are crowded with tourists enjoying an all too brief reprieve from the miserable weather in their home countries.
Here's wishing all our readers everything good for 2008.

pci-international.com

Property in Spain, Tenerife

2008-01-01T01:44:00.000-08:00

January 1, 2008. Everything is quiet. Here, in Playa de las Americas at 9-30 Tuesday, there are still dozy stragglers strolling home from their noctural activities having given up hope of seeing a 'free' taxi.

The Canarians know how to party and, of course, the party will go on until January the 6th (little Christmas in Ireland!) but here El Día de los Magos (magicians or wise men) when gifts are exchanged. Since the 6th falls on Sunday the following day Monday will be a holiday when all major businesess and professional offices will be closed! Hence normality will reluctantly return after the 7th January.
As I write these few words the blissful sound of silence prevails, unusually, in south Tenerife.
Happy 2008 to everybody and prudent property investment whatever destination you chose for your hard earned funds.
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Property in Spain, Tenerife

2007-12-30T23:53:00.000-08:00

These are the key economic projections for Spain 2008

GNP growth 2,6%
Inflation 2,4%
GNP (2008) 1,1 billion €
Population 45,7 million

In the world context with such uncertainty in the financial sector and impending elections in various key countries including the US, Russia and, of course, Spain itself these stats reflect a year of consolidation and stable growth.

The Canary Islands, that have a combined populationof 2 million, are on the same trajectory. Tenerife, has that extra bit of magic created by Mount Teide (at 3700M) the highest in Spain.
Once again, property investment in Tenerife and the Canary Islands generally will prove to be a wise decision. With it's magical all year round climate, it's special status - fiscal and otherwise - within the EC we at PCI consider it an unmatcheable destination for investment funds!
Happy 2008 to everybody.
www.pci-international.com

Property in Spain, Tenerife

2007-12-26T23:56:00.000-08:00

It's interesting to note that people surfing the web for property in tenerife tend to use similar search words or phrases including:

tenerife property,
tenerife property for sale,
buying property in Tenerife,
investments in tenerife
apartments in tenerife,
selling properties in tenerife,
estate agents in tenerife
Irish estate agents in tenerife,
qualified registered bonded estate agents in tenerife
villas land business in tenerife
bars estaurants hotels in tenerife
golf in tenerife
holiday retirement home in tenerife
homes in the sun in tenerife
all year sun in Tenerife
ryanair ireland tenerife
detached luxury villas in tenerife
townhouses in tenerife
medical care and welfare in tenerife
tenerife part of Spain member of the EU

Whatever, please write to us at:
info@pci-international.com
telling us what you want against the criteria of What? Where? How much? and When?
We will treat you with competence, courtesy and integrity.
Happy 2008 for everybody.

www.pci-international.com

Property in Spain, Tenerife

2007-12-25T23:53:00.000-08:00

Once again it's Christmas time in the magical island of Tenerife. For the Spanish the 24th December is the real Christmas where the family try to get together and have a multi course BBQ. The sixth January is the date where gifts are exchanged.
Statistics available this morning - boxing day - indicate that, for the first time, the Canary Islands have a combined population in excess of two million of which almost 12% are foreigners. By 2019 the combined population of the seven Canary islands is expected to reach 2,500,000. Tenerife is expected to have more than a million inhabitants then as against a figure of about 850000 now. This is a reflection also of the sustained demand for property in this special island of Tenerife.
Christmas and new year is also the time when tourists are captivated by the magic of Tenerife, not least it's all year round delightful climate, and decide to invest by purchasing a holiday home the sun.

Property in Spain, Tenerife

2007-12-11T23:57:00.000-08:00

The Federal Reserve has cut the federal funds rate to 4.25% with the implication that further cuts may come if the housing downturn and mortgage lending crisis deteriorates. Commercial banks have responded by reducing their prime lending rate to 7.25%; the lowest in two years. Wall Street remains volatile and indeed the Dow Jones industrial average lost 200 points on digesting the news.
The fed is walking a tight rope trying to maintain a delicate balace between modest growth and a rescession! During 2008, all going well, rising demand for houses driven by lower borrowing rates should push the US economy progressively forward. This has to be good news for everybody. The Bank of England appears to be moving along similar lines.
Incidentally, the US market has been showing increasing interest the the Canary Islands, particularly Tenerife, in recent months. The Canary Islands unique investment tax regime, their strategic location between Europe (ie the EU) and Africa and, of course, Tenerife's well proven attractivenes as a holiday/retirement home destination are all factors creating increasing interest in the US market.
What if there was a Channel Tunnel, linking Europe and Africa, in the Straits of Gibralter!
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Property in Spain/Tenerife

2007-12-10T00:58:00.000-08:00

The recent drop of 0.25% to 5.5% by the Bank of England, though it may appear insignificant, could help stabilize a volatile economy not least the property sector. Markets, whether in stocks and shares or any other commodity, are often more driven by perceptions rather than by reality. The fundamentals of most European economies, including that of Spain, are sound. The problem is that people can talk themselves into a crisis. It's a question of market psychology.

Therfore one would hope that the B of E is sending a clear message that, in the foreseeable future there will be no further increases in rates. Indeed, we may expect a further small reduction in the Spring.
It is not inconceivable that the ECB (European Central Bank) may take a similar view. Current base rate in the euro zone is 4%. We simply need to restore confidence. It has again been shown that property in the medium to longer run always beats the Stock Exchange hands down.
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Property in Spain. Tenerife

2007-11-30T01:37:00.000-08:00

Tenerife has wrapped up phase one of it's development where, as is almost always the case in tourist destinations, quality has often been submerged by quantity; arising from overwhelming market demand. It is now focussing on quality and is spending enormously on infrastructural improvements and providing new, state of the art , world class, facilities.
Siam Park, due to open in spring 2008, will be Europe's largest acquatic theme park with the highest artificial waves in the world. Here you will have, apart from an overall Thai ambience, the largest number of Thai buildings in the world outside of Asia. The promotors are those who have developed Loro Park, in Puerto de la Cruz, to the world renowned facility that it has become.
Siam Park is located in Playa de Las Americas lying beside the Autopista that leads to the Airport and Santa Cruz. The central bus station, the comisaría de policía (police station) the Magma international congress centre, the ocean and, indeed, our own PCI office are just a few minutes walk away over the autopista. Magma is currently hosting the Brittish ABTA conference.
Tenerife is clearly, progressively, becoming more and more a quality world class, upmarket, tourist and investment destination. Now is a good time to invest in, and purchase property in, this magical island of Tenerife.

www.pci-international.com

Property in Spain/Tenerife

2007-11-29T03:46:00.000-08:00

There is a general view by economists that there won't be any global meltdown in 2008. The problems in the US particularly, including the sub prime mortgages, high oil prices and a weakening dollar are unlikely to be potent enough to overwhelm the golobal economy. Outside of the financial sector, the US economy is generally healthy.

For 2008 then, generally, we can expect les volatility, less increases in interest rates with Asia providing the main economic impetus. China has now apparently overtaken Germany as the world's third largest economy after the US and Japan.

Therefore, we don't feel that there is any reason to panic, especially in the property sector in Tenerife and in the tourist areas of Spain . Now is the era of opportunity!!
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Property in Spain/Tenerife

2007-11-19T01:41:00.000-08:00

It would appear that the resentment of Señor Chavez, towards Spain, dates back to 11th April 2002 when the then Prime Minister of Spain - José Maria Aznar - allegedly supported a coup in Venezuela. Presumably Spain's colonial history in Latin America is also a factor.

Señor Chavez has among his closest allies, Fidel Castro, Daniel Ortega of Nicaragua, Eva Morales of Bolivia, Rafael Correa of Ecuador and the Argentinian dynasty of Néstor and Cristina Kirchner.

Meanwhile King Juan Carlos appears to have the overwhelming support of the Spanish people.

Presumably this 'diplomatic incident' will peter out in due course.

Many 'household name' Spanish companies have huge investments in Venezuela including: Repsol, Telefónica, Santander, BBVA, Prisa, Mapfre, ACS, Acciona, Abertis and OHL.

Property in Spain. Tenerife

2007-11-15T02:50:00.000-08:00

During a recent Cumbre Ibero-americana conference in Santiago de Chile, Señor Chavez repeatedly interrupted Presidente Zapatero of Spain calling his predecesor: Señor Aznar a fascist.

Eventually, King Juan Carlos of Spain turned to Chavez, apparently in anger and said 'Why don't you shut up!' ¿Porque no te callas ya?

This has left the entire hispanic world in turmoil but the feeling is that the Spanish people, for whom Juan Carlos is a great and respected favourite, will rally round their king.

Mr Aznar was elected in a democratic fashion whereas the feeling is that the the manner of Mr Chavez' accession to, and his hold on, power was and is somewhat less than democratic. More on this topic later.
GG

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Property in Spain. Tenerife

2007-11-12T08:22:00.000-08:00

November 12, 07

Inflation is creeping up in Spain and is likely to reach about 3.5% by year end.
Unemployment is currently at about 1.8 million or 8% of the active population.
The number of people curently employed in Spain is about 20.5 million; the highest on record.
Projected GNP for 2008 has been adjusted to 3%.
A new, more investment friendly and equitable tax regime is expected to be in place by January 2008.
It is likely that there will be a general election in March 2008.
Ryanair, the low cost flight company, has just begun flying to Reina Sofia airport, in Tenerife South, from several European destinations including Dublin and Shannon.
Tenerife is becoming more and more attractive as a property investment/holiday destination.

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Property in Spain. Tenerife

2007-11-07T06:14:00.000-08:00

Undoubtedly Tenerife enjoys a year round magical climate, to some extent generated by Mount Teide at 3700M the highest in Spain. Those of us who reside here permanently sometimes wish for more rain since the trade winds tend to bring lots of sand and dust in their journey across the north western part of the African continent.

It seems almost a year now since we had any significant rain in South Tenerife and one senses that it is going to come very shortly. The cleansing impact of a few hours of heavy rain is very noticeable and indeed very welcome. The island looks even more beautiful after being washed by a 'downpour'.
pci-international.com

Spanish Property

2007-10-29T08:22:00.000-07:00

I suppose that the main theme running through this 'so far', intermittent series is 'let the buyer beware'. Caveat emptor. Many investors, mostly non professionals, have sought, during the last five to ten years to augment their pension potential by purchasing, almost anywhere, on a guaranteed rental basis.
Personally, I don't believe that there could be such a thing as a guaranteed rent. Who is the guarantor? Is this person or entity immune to economic cycles, economic disasters? Is there any entity in the world that cannot fail? Whether you agree or not I suggest it is prudent to assume that I am right ; that there is no such thing as a guaranteed rent.
Many developers, during the boom years, and many 'irrationally exuberant' estate agents have offered huge 'discounts', guaranteed rents and 100% plus loans to thousands of unfortunates all over the world most of whom are now being bruised by harsh reality.
The message once again is be careful, deal only with and through professional, qualified, and bonded estate agents. Check them out. Happy, stress free, investment to all!
pci-international.com

Property in Spain

2007-10-18T07:17:00.000-07:00

Tenerife is a magical island with the magic being largely generated by Mount Teide; at 3700M the highest in Spain.
It has a fixed population of less than 850000 but welcomes more than 5 million visitors each year.
In recent years many overseas investors drifted away from Tenerife to pastures new: towards the new members of the EU and elsewhere. Prices appeared to be attractively low relative to Tenerife. However, these countries don't have the infrastructure, physical and social of Tenerife which is rapidly becoming a five star tourist destination.
Here you are part of the EU since 1986, enjoy a magnificent year round climate with consequent all year demand for property and, with the advent of companies such as Ryanair flying directly to south Tenerife, it is now feasible to take a weekend break from London or Dublin or Shannon or ...
'The hills abroad are always greener' but, it is difficult to conceive of any other destination in the world that can offer the facilities including health and security and general quality of Tenerife. Furthermore, practically everybody speaks English!
PCI-international.com

Spanish & Tenerife Property

2007-10-16T00:41:00.000-07:00

There is a evidence that Tenerife has been occupied for more than 2500 years. The original inhabitants were known as Guanches and the balance of opinion suggest that they came to Tenerife from the area of Barbary and ancient Libya in north Africa.
The Berber tribes were, strictly speaking, not Arabs, and may be either fair or dark skinned. Recently, people were surprised to find that there are blond children in this historic area, in the context of 'sightings' of the little McCann child missing for about four months now from a holiday resort in south Portugal..

The islands were conquered by Spain (Conquistadores) during a period from 1402 to 1496 when Tenerife finally ceded in the second battle of Acentejo. This was a glorious period in Spanish history generally and particularly the year 1492 when Columbus discovered the Americas - celebrated each year on October 12 - and the final defeat of the Moors in Granada (The Alhambra) in the same year.
This was during the reign of Los Reyes Catolicos: Isabella and Ferdinand. This couple were also instrumental in launching the infamous Spanish Inquisition.
The moors who have had such an enormous influence in Spanish history, architecture and culture generally, first invaded mainland Spain via what is now Cadiz in 711 AD.
pci-international.com

Property in Spain/Tenerife

2007-10-15T06:54:00.000-07:00

This weekend has been a 'puente' here in Tenerife. Puente means a bridge and arises when, for instance, both Friday and Monday are holidays. Therefore, the worker enjoys a bridge from Thursday afternoon to Tuesday morning.
Friday last was a national holiday in Spain: El Día de La Hispanidad celebrating the discovery of the Americas by Columbus on 12th October 1492.
Today Monday is a local or municipal holiday in Adeje with public offices closed including courts, notarios and indeed most professional offices.
Being in the international property business the PCI office tends to open on all such holidays; at least from 9AM until 1PM. Otherwise, clients, actual and potential, trying to telephone us from outside Spain could conclude that we were 'no longer in business' and that would never do! Furthermore, its important not to forget that the Spanish, both mainlanders and Canarians, are also buyers and sellers and find it very convenient to come to our office on such fiestas...provided that we are open!
The weather here is glorious...as usual. Since we haven't had rain for some time we are all hoping for a good, cleansing, downpour.
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Property in Spain. Tenerife

2007-10-12T02:41:00.000-07:00

We are back on air again after a month on the sidelines with a virus caught from the ocean. Unfortunately, while attempting to explore a fish farm (Jaula Marina) located about 1km from land, a large wave washed through the installation some of the effluent from which, apparently, landed in my lungs.
The return journey to shore, swimming in increasingly rising seas, was a never to be forgotten experience. A weight loss of 15 kilos during the subsequent two months and a cocktail of drugs for the past month accounts for the long silence.

Anyway, good news at last in Spain for professional estate agents and, no less importantly, for property investors and property purchasers in Spain, whether local or foreign.
Real Decreto 1294/2007, dated 28th. September, has once again restored the APIs (Agentes de la Propiedad Inmobiliaria) to their 'primus inter pares' position in the estate agency sector; uniquely recognised by the Spanish Government and the Ministerio de Viviendas.
The clear message is that, if you want to Invest in Spanish Property Without Stress, look for the API sign. Look for the qualified, registered, internationally recognised and professionally bonded estate agents. It is not too difficult a search. There are 6000 of us throughout Spain, including one or two non nationals such as myself, but... it will be well worth the effort.
Ciao
pci-international.com

Spanish Property

2007-09-09T07:10:00.000-07:00

It is interesting that the Spanish, almost uniquely among the now 27 members of the EU, consider themselves better off by being members . Perhaps this has something to do with the fact that Spain has benefited by way of structural funds and otherwise from the EU taxpayer to a level of almost 150 billion euros; a not insignificant amount!

Interesting also to note that, of the few countries in Europe that have remained outside the EU such as Switzerland, Norway and Iceland, all are wealthier per capita than any EU member. Not least of the problems of the EU, apart from an increasingly suffocating bureaucracy, is that the € (euro) its holy grail, based on a one size fits all philosophy, was an economic concept politically driven.

Property in Spain

2007-09-06T23:25:00.000-07:00

The European Council - effectively the proposed government of the EU - has been gestating for more than 40 years with the seeds being sown by the French Jean Monnet who conceived summits of heads of governments leading to ever further political integration. Until recently this European Council has never formed part of the EU government structure. Now this is suddenly changing. Under the new treaty/constitution this council will be formally recognised as an Institution of the union along with the European Commission and the European Parliament.
It is clear to see that the Council's role will be to act as the new government of Europe. Heretofore when heads of state participated in such summits their prior allegiance was assumed to be to their home state. Now, members of this supreme council will stake first loyalty to the council.
In article 262 of this constitution it says that, by decision of the European Council, the EU 'may establish new categories of own resources', which effectively means it will have authority to raise its own taxes. This is a monster on which we are being deprived the right to vote. It this what we want? This Supreme, all Powerful Faceless, Unaccountable, EU Government! Where will it all end!!!
If we do not want this suffocating supreme authority then lets say so loudly...before it is too late. Time is of the essence
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Property in Spain

2007-09-06T08:03:00.000-07:00

This proposed EU constitution, for it is nothing else, will, if accepted or, more likely, be railroaded through, have far reaching impact on all EU citizens present and future. It appears that the movers and shakers in Brussels do not wish to grant the hoi polloi of EU membership the right to vote on this constitution.

Not least of the implications, for the UK for instance, is that it may have to cede its permanent seat on the UN Security council – of more than 60 years standing - to an EU delegate.

If there is a major weakness in the democratic system it is this. That those entitled to vote are unwilling to insist on such entitlement or even make the effort where the right to exercise their franchise is freely available. Hence we berate our public representatives when sitting, pontificating, on high stools while by default we allow people to walk into representative office who, in normal circumstances, we would not permit walk our dog! Perhaps, even in a so called democratic society it should be an obligation, for qualified citizens, to exercise their franchise for which their forefathers shed so much blood! Do we not at least owe them that small effort and gesture?

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Property In Spain

2007-09-05T01:34:00.000-07:00

Just to break with routine we today announce an interesting release of reformed apartments (85 in all) in a very central, long established, apartment complex in Playa de las Americas.

Playazul,

Just Released:

Option on being fully reformed

These may be purchased individually or in groups and either way this launch certainly represents an opportunity for the discriminating investor.

Studios	M2 from	Prices from €
16	34 + 6M2	100.000
26 (1 bed)	44\50 + 10M2	147.000
43 (2 bed)	56\66 + 10M2	172.000
85

· Overlooking new Siam Park.

· Five minutes walk from central bus station.

· Five minutes walk from central police station.

· Five minutes walk from ocean and beaches.

Five minutes walk from Las Americas Golf course and clubhouse.

· All shopping and sport and social facilities within a few minutes walk.

· 2 hospitals and a multi-denominational church nearby.

This is a unique investment opportunity in the best location in Las Américas. Not to be missed!!

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Propert in Spain

2007-09-03T02:15:00.000-07:00

Phase one, which has lasted for about forty years, is over. Enormous progress has been made even if, at times, quality has been sacrificed for quantity. We now have the opportunity to take stock, to decide where we have been, where we are now, where we want to go, where we should go and, last but not least, where we can go with the blend of resources available to us while being ever sensitive to the dynamics of the market place. This review should above all be a learning experience. If we don’t learn from the past we are doomed to repeat any errors that we may have made. Quality rather than quantity in every aspect of the term should be our motto and in this context perhaps we should accept that five million tourists is at or indeed above the level sustainable by Tenerife. It appears clear that at or near this figure the island of Tenerife, for example, is close to overload. There is overall saturation and diminishing returns set in.

Low cost airlines and an ever-expanding EU have transformed the tourism world. Furthermore, tourists are becoming more adventurous in their choice of destinations.

Why would tourists come here rather than go to an increasing number of alternative destinations where they may enjoy equal or better facilities at possibly lower prices? Rather than trying to sell what we believe we have got to offer, perhaps we should ask tourists, both actual and potential, what they want and expect from us. This is probably the essential difference between selling and marketing. There are two simple and practically cost-free methods of acquiring this feedback, this very valuable marketing information.

The first one is to have a continuous process of exit interviews, conducted by trained multilingual interviewers, in the departure lounges of both Reina Sofia and Los Rodeos. Here you have a willing and representative market sample in a situation of enforced boredom for anything up to two hours. These home bound tourists will be delighted to cooperate with the survey and get any grievances off their chests.
The second source of information is to ask the thousands of foreign residents, particularly those from the EU who live and work here, for their views. These people can be both one of our best sources of information and also our best ambassadors. Imagine the huge multiplicity of skills including languages and diverse experiences which such people as a body have to offer, at no cost...pro bono patria adoptada! Many of these ‘foreigners’ are very special tourists (resident tourists) in that they spend money here every day for several months each year and not just for a week or ten days! Should we not award these people VIP treatment? At worst, is it not better to have us inside your tent, pissing out rather than outside pissing in? However, foreign residents must become involved and must register themselves both as residents and as eligible to vote both in the local and EU elections . We cannot dine a la carte. We have rights but also obligations including an obligation to participate in the local political process in order to improve the quality of life for everybody.

Tenerife is used here as an example but the assessment is equally valid for any of the Spanish tourist destinations whether coastal areas or islands.

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Propety in Spain

2007-08-31T23:24:00.000-07:00

The Property Sector: This is the area of commercial activity in Tenerife that appears to have most adverse impact on the Island’s image overseas. The problems seem to be essentially two:

The Timeshare business, more importantly, the methods employed in its operation and
The alleged misconduct of estate agents.

There is nothing wrong with the concept of timeshare. It’s how the concept is sold that creates problems. Sometimes one feels that the fundamental trading principle of ‘nemo dat non quod habet¹’ appears to have gone out of fashion.

With regard to estate agents perhaps it is relevant to mention Royal Decree-Law 4/2000, of June 23. This RD states that “the activities that up to now were reserved exclusively to members of the College of APIs are henceforth open to anyone, without the necessity of having any qualification or being a member of any Institute.” Thus the Spanish Government, uniquely in the developed world, effectively declared a free-for-all in the property market! This is an example of a laissez-faire philosophy being very much counter-productive. Incidentally, a perusal of the API examination syllabus indicates a professional qualification that compares favourably with any international equivalent.

Unfortunately foreign buyers do not discriminate because, in the short term, they’re sun-struck and, as a consequence, have left their brains on the plane. In any civilised society being an estate agent ought to mean more than mere ownership of a mobile phone. When such agents deal almost exclusively with foreigners i.e. tourists, then it’s a case of ‘Houston we have a problem’! Caveat emptor².

Another law, unique to the Canary Islands, which continues to cause grave concern, is the Tourism Law (Ley de Turismo) and its very controversial Article 38 which deals with Unity of Exploitation. This law has been a disaster ever since its inception. One has to assume that it was introduced in good faith with the objective of improving standards and service in the tourism private letting sector. The fact that no serious attempt has been made to implement the law isn’t relevant. The reality is that it has created a lot of uncertainty and unnecessary conflict in tourism accommodation. Simply stated, Article 38 envisaged that only one entity could manage the lettings in any one complex, regardless of size. Strangely enough no real standards of competence, experience and or qualification were set for this management entity that would inevitably have a monopoly of all tourist lettings in each residential complex.

This meant that:

Qualified estate agents couldn’t, strictly speaking, manage the apartments that they had sold to long established clients unless, of course, they were one of the fortunate monopolists and
By definition, this letting monopolist could set ludicrously low levels of return for the owners, including many elderly foreigners, on a ‘take it or leave it’ basis.

It is clear that, if rates of return are maintained at artificially low levels, the market values of such tied properties will, certainly in the medium to longer term, also be artificially low allowing the management entities to quietly accumulate a nice property portfolio at bargain basement prices! Is it any wonder that Brussels has expressed grave concern about this particular piece of legislation! Since most residential property purchase by foreigners is generated by tourism, it is hard to imagine that this law represents good PR for the islands. It is generally accepted that many potential investors, who otherwise would have come to Tenerife, are going elsewhere because of this Article 38.

Alicante Province: LRAU 1994: This law was passed with the apparent intention of facilitating the development of the Valencian Community. However, especially in recent years, it has been abused by developers with the enthusiastic support of Town Halls, and has caused huge distress to people who have had their land and houses expropriated with little compensation and/or have been obliged to contribute large sums to civil engineering or development infrastructure costs. ‘Land grabbing’ is historically and justifiably an hugely emotive term and, apart from causing grave anxiety at EU level, the implementation of this law is generating very bad publicity overseas not only for Valencia but also for Spain generally and especially its tourist zones, including Tenerife.

Undoubtedly all of us who cherish the right to own property deplore the brutal confiscation of private property in Zimbabwe, for instance, under the savage regime of Robert Mugabe. The methods employed in that country may be different from those applied in Valencia but the end results for the ‘victims’ are similar. Hence, the following issue needs to be determined here in Spain or, if necessary, at European Court of Justice level, as a matter of some urgency.

Does the 1978 Spanish Constitution adequately protect the rights of private property ownership, as recognised in Article 33, in all seventeen Autonomous Communities? This Article should not be in conflict with Article 47 that enshrines the right of every Spanish person to adequate and decent living accommodation.

At the time of writing the Spanish autorities are becoming cognicscant of these two problem and propose takng appropriate action.

España es diferente. Spain is still special.

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Property in Spain

2007-08-31T00:44:00.000-07:00

Perhaps Team Tenerife 'or Team tourism anywhere' could usefully consider the following broad action plan:

Decide on our objectives for the next five and ten years.
Invest hugely in education, R & D, and continuous professional training of which work experience abroad should be an integral part.
Orient our students, from their apparent inclination towards the study of law for instance, towards skills, including languages, which will inevitably lead to worthwhile employment opportunities, home and away, if not to self-employment.
Streamline bureaucracy and administration and set clear rules, fiscal and otherwise, such that private enterprise and self-employment will be stimulated.
Encourage a self-employment philosophy…market rather than politics driven.
Maximise the employment creation potential of our special fiscal regime particularly with regard to a planned diversification from such significant dependence on tourism.
Encourage the employment creators and inculcate pride in being competitive and productive and in the concept of ‘the delivery of a product or a service to best time, cost and quality standards’…with a smile. Here we are talking about a work ethic and taking pride in one’s contribution.
Exploit the enormous resource which is available free of charge: the experience and advice of the thousands of foreigners resident here with their multiplicity of skills.
Plan for conceivable, if improbable, crises mostly generated by factors outside our control such as:

· An Avian Flu pandemic, or a similar apocalyptic scenario, which many sages consider inevitable and that could wipe out up to 50 million people worldwide. This would lead to global economic disruption, financial chaos and political anarchy. During the Spanish Influenza Epidemic 1918\19, about 30 million people died worldwide! The recent New Orleans catastrophe is a chilling reminder of the awesome power of nature.

· A ‘Jaws’ scenario where there occurs one or more fatal shark attacks as a result of predators being attracted closer inshore by either changing ocean temperatures or the lure of aquaculture installations.

· A major terrorist attack.

· The failure of the Euro with the subsequent potential disintegration of the EU.

· Significant, rapid, micro-climatic changes, within the overall dynamic global climatic system, as a direct consequence of our own ‘greening’ actions and

· A tsunami of immigrants or refugees from the black continent.

Finally, it is important to remember that tourism is not an end in itself. It is merely one of many means to an end. There are, and indeed must be, several other means including those being generated by our unique fiscal regime. What is the end? Is it the pursuit of the best quality of life for all our people? The people through its elected representation, i.e. its government, must decide. The purpose of government according to Thomas Jefferson is “to allow for the preservation of life and liberty, and the pursuit of happiness”. We are fortunate in having some exceptionally talented and committed politicians in Tenerife. So we must endeavour continuously to optimise the health, wealth and happiness mix of the greatest number of our people…including foreigners legally resident here.

www.pci-international.com

Property in Spain

2007-08-30T05:05:00.000-07:00

Somebody asked us the other day 'what is Town Planning'? Not being experts in the field it made us think.

Sometimes in a famous resort, while the natural environment is special, the man-made environment may be somewhat less so. It is not quite so impressive. Perhaps if we look at this man-made environment against the yardstick of internationally accepted town-planning norms we may begin to see why generally it doesn’t do justice to and match up to the unique natural inheritance.

The art and science of ordering the use of land and the character and siting of buildings and communication routes so as to secure the maximum practicable degree of economy, convenience and beauty.

From this definition some fundamental principles of successful Town Planning emerge:

The promotion of accessibility; accessibility of homes to work, shops, schools and entertainment, of industry to sources of labour, power and raw materials and so on. It would hardly be going too far to call Planning a study in accessibility.
The employment of resources as economically as possible, so as to achieve the greatest possible measure of improvement with necessarily limited means.
The separation of incompatible land uses from each other and the association of compatible or mutually helpful uses and finally
The carrying out of all development in as visually pleasant a manner as is practicable.

The general point being made here is that with regard to most developments, particularly in the concrete jungles that many tourist destinations have become, any conformity with established principles of Town Planning would appear to be purely coincidental. We continue to build beehives and rabbit warrens that, almost by their nature, are visually unattractive. There is over intensification of development, developments out of scale with their sites and out of empathy with their immediate environment leading to adjoining projects literally screaming at each other…and at the passer-by, including the tourist! More often than not there is no overall design brief to which all the individual components should conform. Walking through some of these development ‘mixed salads’ one can easily imagine the frame of mind of the Norwegian Edvard Munch as he worked on his famous creation: The Scream.

This man made environment is an intrinsic part of the tourist destination marketing package and is further diminished by the huge number of unfinished buildings and projects...whether for legal/technical or financial reasons.

www.pci-international.com

Property In Spain

2007-08-28T06:37:00.000-07:00

No special thoughts occur today. Tenerife in mid August is, as always, beautifully sunny with a multiplicity of tourists from all over the world lounging by the various beaches or strolling through the shopping centres. August tourists are generally made up of families from mainland Spain and young 'school going' English families.
The shopping centre where we, PCI, are located- San Eugenio - is more interesting than most as it has, apart from the usual selection of shops, two notary offices, the land registry for the general area, two abogados (solicitors) two banks and two delightful tapas bars in the central ground floor patio or plaza. At basement level there is ample parking and a large Mercadona supermarket.
The entire complex is very pleasant, modern, well designed and within five minutes walk of Puerto Colon and the ocean. The Las Americas Post Office, an interdenominational church and central police and bus stations are also just a few minutes away. Recently just few minutes away we also inaugurated a new congress centre and a new multi-cine shopping complex. All in all C. C. San Eugenio is a pleasant working or visiting environment.

Property in Spain

2007-08-27T06:21:00.000-07:00

Low cost airlines and an ever-expanding EU have transformed the tourism world. Furthermore, tourists are becoming more adventurous in their choice of destinations.

The first one is to have a continuous process of exit interviews, conducted by trained multilingual interviewers, in the departure lounges of both Reina Sofia and Los Rodeos. Here you have a willing and representative market sample in a situation of enforced boredom for anything up to two hours. These homebound tourists will be delighted to cooperate with the survey and get any grievances off their chests.
The second source of information is to ask the thousands of foreign residents, particularly those from the EU who live and work here, for their views. These people can be both one of our best sources of information and also our best ambassadors. Imagine the huge multiplicity of skills including languages and diverse experiences which such people as a body have to offer, at no cost...pro bono patria adoptada! Many of these ‘foreigners’ are very special tourists (resident tourists) in that they spend money here every day for several months each year and not just for a week or ten days! Should we not award these people VIP treatment? At worst, is it not better to have us inside your tent, pissing out rather than outside pissing in? The fact that Tenerife is by its nature a magical island, with most of the magic being generated directly or indirectly by Mount Teide is not open to debate. It is simply an indisputable fact, literally written in stone. Therefore in principle we have a fabulous product to market and that is the wonderful, indeed the unique, island of Tenerife. However, in order to optimise its potential, Tenerife must be marketed as an entity, as a whole, not just any specific part of it.

While the natural environment is special, the man-made environment in Tenerife is somewhat less so. It is not quite so impressive. Perhaps if we look at this man-made environment against the yardstick of internationally accepted town-planning norms we may begin to see why generally it doesn’t do justice to and match up to our unique natural inheritance.

Property in Spain

2007-08-22T09:33:00.000-07:00

Subprime Crisis

We have been reading a lot lately about the subprime meltdown and a possible global financial crisis that could set the world economy into a tailspin.

The problem in essence appears to be that the US sub prime – i.e. high risk - mortgage market is grossly over lent. The subprime market is where mortgage lenders lend money to consumers with a poor credit history where the prospects of repayment are little or none. This would appear to be a fundamental breach of basic banking principles or indeed of basic common sense. An assessment of repayment capacity should be the primary concern of any lender!

Particularly after the twin towers disaster in 9/11, US banks and mortgage lenders entered one of their cyclical phases of ‘irrational exuberance’ and grossly over lent thus financing a huge housing boom. This philosophy was, as always, based on the idea that the boom would go on indefinitely thus providing sustained prices increases that in turn would create sufficient equity to cover any repossessions.

The international implications are generated by the fact that these subprime lenders, such as Britain’s HSBC, merely packaged bundles of these loans and sold them on to other financial institutions world wide…as investments! With inevitably increasing defaults and repossessions these investments are potentially worthless.

One of the implications of this developing scenario is that the world financial system’s profitability will be reduced; in turn reducing its capacity and indeed willingness to finance business generally. You are talking about a potential credit squeeze with all that that implies. The international financial system is based on confidence and, if this confidence suffers a serious blow, the system can become like a house of cards.

One redeeming feature for the eurozone is that this credit restriction cause by the US subprime crisis will stave off; at least for the time being, what appeared to be another inevitable increase in the ECB rate.

www.pci-international.com

Spanish Property

2007-08-21T06:50:00.000-07:00

The purchase:

Sometime I think that a competent estate agent is more important for the purchaser than for the seller. After all, if you are selling your two bed-roomed apartment in a well established complex, arriving at a selling price shouldn’t be too difficult since you will have many yardsticks for comparison. Then you just put up a private for sale sign and…there you are!

Purchasing, however, is somewhat more complex.

If it is a resale property you need to ensure, inter alia, that:

Title is in order.
That all outgoings are up to date and that
There are no development plans envisaged that will adversely impact on your investment in the future.

If it is in a new development you need to ensure, inter alia, that

The development is legal and has all the approvals.
The conditions of contract are not unduly loaded in favour of the developer such as penalty clauses that only apply to the purchaser.
The statutes of the community, actual or proposed do not contain conditions such as ‘no animals’ that you may find unacceptable.
Payment schedule and facilities are clear and unambiguous.
Structural and financial guarantees prevail.

You should then select your estate agent on the basis that:

He is qualified, registered and professionally bonded and that
He is recommended by people that you know and trust.

Then, having pre-qualified your agent you should come clean with him and tell him exactly what you want against the criteria of:

What?

Do you want a two bed-roomed apartment or a luxury villa? Do you want sports facilities, garage, or commercial facilities in a community?

Where?

What are your location criteria? Is it essential that you are within walking distance of shopping, the beach, bus station, church or school?

How much?

What is the maximum budget that you feel comfortable with including all acquisition costs? and

When?

Do not use your estate agent as a tourist guide. If you are only toying with the idea of a purchase, possibly with a view to taking early retirement five years hence, then…say so. Your professional estate agent will be no less helpful but time wastage and possible ill feeling will be minimised for all concerned.

www.pci-international.com

Propery in Spain

2007-08-20T07:09:00.000-07:00

The Spanish economy has made enormous strides over the last ten years or so, particularly taking into consideration that it has enjoyed a democratic system for only thirty years. It operated under a military dictatorship for forty years prior to then until the death of General Franco in 1975. Furthermore it became a full member of the EU only on January 1, 1986; thirteen years after the British Isles.
In the meantime the population has grown by more than four million and unemployment has dropped from 14 to about 8%. I t currently constructs more homes than any other European country. In 1996 it constructed 276451 homes and in 2006 this amount more than doubled to 657990 in 2006 of which a little over 9% were subsidised homes for the less well off.
GNP is estimated to grow at close on 3% in 2007 to a level of over one billion euros. GNP per capita 23000€. A socialist PSOE led government was elected in 2004 and the next general elections are scheduled for March 2008. Spain is second only to France as a world tourist destination with more than 52 million visitors in 2006. Massive funds are being spent on infrastructure including the AVE or high speed train system scheduled to link Madrid to both Barcelona and Málaga before year end.
An ongoing problem since 1959 is the claim of the terrorist group: ETA for a separate Basque state comprising part of the north of Spain and the South of France. There doesn't appear be any historical foundation for this claim nor is it conceivable with both countries being members of the EU. Ever increasing co-operation between the security forces of Spain and France appear to have reduced this problem dramatically in recent years.
There will probably be a period of consolidation for 'economy Spain' over the next year or so but undoubtedly it has the potential to be a major economic power. As an investment destination it remains more attractive than most alternatives.
www.pci-international.com

Spanish property

2007-08-18T23:05:00.000-07:00

Spain, from an administrative point of view, is divided into seventeen autonomous communities of which all seven Canary Islands form one. These are Tenerife, La Gomera, El Hiero, La Palma, Gran Canaria, Fuerteventura and Lanzarote. Total population of the islands is just less than two million against a a national population of about forty four million.

Tenerife is probably the more interesting island largely due to the impact of Mount Teide at 3700M the highest in Spain. This magical mountain creates a multiplicity of micro climates such that on any one day you can have snow on top, 40 degrees on the beaches twenty minutes away, rain to monsoon level in the north of the island and winds at almost gale force in the El Médano area near Reina Sofia airport.
www.pci-international.com

Spanish Property

2007-08-18T07:34:00.000-07:00

Estate Agents generally, along with second hand car sales people tend to be much maligned and little trusted people. In Spain, particularly in its tourist areas, there may be some merit in that perception (of them) by the public at large. Certainly the property sector in Spain has a rather poor image and the recent Operation Malaya in Marbella has done little to alleviate that. Legislation introduced by the then government in the year 2000 would appear, if anything, to have exacerbated the problem

In this regard we refer to Royal Decree-Law 4/2000, of June 23. This RD states that “the activities that up to now were reserved exclusively to members of the College of APIs (Agente de la Propiedad Inmobiliaria) are henceforth open to anyone, without the necessity of having any qualification or being a member of any Institute.” Thus the Spanish Government, uniquely in the developed world, effectively declared a free-for-all in the property market! This is an example of a laissez-faire philosophy being very much counter-productive. Incidentally, a perusal of the API examination syllabus indicates a professional qualification that compares favourably with any international equivalent. See www.coapi.es

Unfortunately foreign buyers do not discriminate because, in the short term, they’re sun-struck and, as a consequence, as has been suggested earlier, have left their brains on the plane. In any civilised society being an estate agent ought to mean more than mere ownership of a mobile phone. When such agents deal almost exclusively with foreigners i.e. tourists, then it’s a case of ‘Houston we have a problem’! Caveat emptor. Let the buyer beware.

Dont leave your brains on the plane.

2007-08-17T00:52:00.000-07:00

Over the years we have seen the most sensible people come to Spain and do the most incredibly silly things with their hard earned money. At home they wouldn't dream of buying the property next door for instance without having proper advice; legal and otherwise. However, they get off the plane in Reina Sofia or Malaga, leave their brains on board, become immediately sun and sangria struck and proceed gaily to commercial hara-kiri.
They have the contact details of the delightfully mini- skirted salesperson who they met briefly at a property exhibition in Dublin, or Birmingham or Oslo. In an enthusiastic flush of 'irrational exuberance' they sign a contract in a language that they don't understand (Spanish) without consulting a lawyer or somebody competent to advise them. 'No need for a lawyer', they are told. 'Nobody does it here. We will look after you. Pay half the price in black. You save on stamp duty or property transfer tax. It's the custom here'.
Apart from the legal implications, an apparent short term saving on property transfer tax can have very ominous capital gains implications downstream where CGT will be payable at a considerably higher rate than property transfer tax.
Quite often this all happens over a highly pressurised weekend inspection flight when many, indeed most, professional offices are closed. These inspections flights may be subsidised but, of course, there are no free lunches and as the saying goes 'if it sounds too good to be true it probably is'!
Things may work out all right at the end of the day but frequently in such a game of commercial Russian roulette what has occurred is that a time bomb has been set that may not explode for several years.
www.pci-international.com

PCI International

2007-08-16T09:11:00.000-07:00

Since this is the first posting perhaps we should briefly introduce ourselves.
PCI International is a Tenerife based, Irish owned, property company providing a total property service ranging from site investigation and acquisition negotiation through the town planning process to actual construction or project management, investment creation and final selling on and or ongoing property management as relevant. Essentially we are estate agents specializing at the more expensive end of the market.
Our portfolio includes apartments, villas, bars, restaurants hotels and development land. While we operate throughout Spain , we tend to concentrate on the Canary Islands; particularly Tenerife.
We are fully qualified as chartered surveyors, inter alia, both under Spanish and EU laws and are professionally bonded.
Our web site that we are currently developing is at : www.pci-international.com.