Spain : Spanish VAT reduction extended and is on holiday homes

The condition excluding newly-built holiday-homes from VAT reductions appears to have been dropped.

When the Socialist Government introduced a VAT reduction on new homes sold last year, from 8pc to 4pc, the People’s Party, then in opposition, promised to extend the reduction to the end of 2012, but only on primary residencies up to a certain price.

But now that the PP are in power it appears that they have dropped these conditions, which can only be good news for holiday-home buyers looking to take advantage of the crash in Spain’s new home prices.

The decree extending the VAT reduction to the end of the year, published in the official Government bulletin (BoE) on the 31st of December, made no mention of any extra conditions, meaning that VAT on all new home sales, whatever their use and value, will only be charged at 4pc during 2012.

Source Mark, Spanish Property Insight


Lydnem comment


Great news!! All new properties (not registered previously) will only face 4% IVA (VAT) instead of 8% until the end of 2012. This is very good news for the new build properties but also for the market as a whole as it draws attention to it. Dont miss the best properties and best mortgage facilities while they are still available and the Bank of Espana allows the banks to offer high loan to value properties


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USA: Property prices set to end the year down

Residential property prices in the United States continued to drop towards the end of 2011 with the latest figures from CoreLogic showing that national home prices fell 1.4% in November, the fourth monthly fall in a row.

On a year on year basis prices, including distressed sales, fell by 4.3% compared with November 2010, the information and analytics company’s November Home Price Index also shows.

This follows a decline of 3.7% in October 2011 compared to October 2010. Excluding distressed sales, year on year prices fell by 0.6% in November 2011 compared to November 2010 and by 1.6% in October 2011 compared to October 2010. Distressed sales include short sales and real estate owned transactions.

‘With one month of data left to report, it appears that the healthy, non distressed market will be very modestly down in 2011. Distressed sales continue to put downward pressure on prices, and is a factor that must be addressed in 2012 for a housing recovery to become a reality,’ said Mark Fleming, chief economist for CoreLogic.

Including distressed sales, the five states with the highest price gains were Vermont which was up 4.3%, South Carolina up 2.8%, District of Columbia up 2.1%, Nebraska up 1.9% and New York up 1.7%.


Including distressed sales, the five states with the greatest price falls were Nevada where prices were down 11.2%, Illinois was down 9.7%, Minnesota fell 7.8%, Georgia was down 7.7% and Ohio down 7.2%.

Excluding distressed sales, the five states with the highest price increases were Maine and South Carolina, both up 4.9%, Montana up 3.8%, Indiana up 3.3% and Louisiana up 2.4%.

Excluding distressed sales, the five states with the biggest price drops were Nevada which was down 8.8%, Arizona down 4.9%, Minnesota down 4.7%, Idaho down 4.1% and Georgia down 3.6%.

Including distressed transactions, the peak to current change in the national HPI from April 2006 to November 2011 was -32.8%. Excluding distressed transactions, the peak to current change in the HPI for the same period was -23.1%.

Of the top 100 Core Based Statistical Areas (CBSAs) measured by population, 77 are showing year on year declines in November, three fewer than in October.

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