SPANISH CULTURE – WHY LIFE IN SPAIN WORKS…

A week ago, I was reminded, yet again, of why life in Spain works so well for me and why, as a family, we are so comfortable here. Indeed, last week’s ‘reminder’ exemplified the glory of Spanish culture and provided (for me, at least) probably the single most compelling reason for moving to Spain.

Along with much of the rest of Spain, the weekend before last was when the annual fiesta of San Antonio was celebrated. This is a ‘minor’ but ritualised fiesta that revolves around the blessing of a community’s animals.

In my village, the night before the fiesta, there were fireworks and a large bonfire, around which much of the village gathered to enjoy the delights of free wine and nuts and jovial company. The next day (Sunday) the morning church service was followed by a formal procession that circled the village. This involved an effigy from the church being rolled out and pushed by several of the village men with, behind it, our village priest looking suitably solumn. Behind him were twenty or so members of our village band playing beautifully performed music that ranged from the stirring to the elegaic.

However, the most extraordinary sight of all was seeing the vast majority of the village population (from the oldest to the very youngest) walking ahead of the effigy - with virtually everyone carrying or leading their animals. These varied from parrots, mice and small creatures to tortoises, dogs and horses.

As you can imagine, the procession was lively and good natured. Excited children proudly showed off their pets to their friends whilst the villagers natural good humour was to the fore, amidst barking dogs and skitterish horses.

Gradually, the procession wound its way through the village and slowly back to the church where the priest was presented with the villager’s animals. These were blessed individually before the villagers eventually dispersed to their homes and various bars.

I can almost hear you sighing in bored incredulity! What, you may well ask, has this got to do with moving to Spain?

Well, in my view, everything!

Yet again, our village demonstrated that not only was Spanish culture ‘alive and well’ but that it was relevant to the whole community. Almost the entire village was involved in the fiesta and almost everyone took an active part.

Naturally, it would be easy to make fun of the idea of ‘blessing’ animals, just as you could easily mistake the San Antonio fiesta for indicating a deep religiosity amongst the Spanish. Certainly, the latter is not true, anymore in my village than elsewhere in Spain. The Spanish are a secular society with, probably, the same low proportion of people attending church as in the UK. However, in Spain, a fiesta (based on religion or otherwise) is all about the unity of a community as a whole. This means that the participation of everyone is important - even if it involves giving a gentle and tolerant ‘nod’ to any religious element.

My point, of course, is that the ‘nuclear’ community in Spain (as a whole) still exists and, in the case of my delightful village, it works very well. It functions ‘overtly’ as seen during fiestas but also (far more importantly) it works on a day to day basis. This is why crime is low and why life in Spain can be so seductive, particularly if you integrate within your local Spanish community. If you do - then you have every chance of being an integral part of a ‘culture’ that probably last existed in the UK, in any meaningful sense, over fifty years ago.

Certainly, our life in Spain has been ‘made’ by the Spanish themselves and by Spanish culture. Not high Spanish culture, of course, but the culture present in our day to day lives. Overwhelmingly, this has been one of toleration and welcome, generosity of spirit and a sense of fun - all within a caring, tightly knit community.

Of course, the weather is great, the al fresco life attractive and access to beautiful beaches and mountains wonderful. However, none of these things are sufficient, long term, to make life in Spain (in my view!) truly fulfilling. That, for us, has come from the Spanish people themselves, their way of life, values and overall culture. These are the real reasons for moving to Spain and why life in Spain can be so enchanting...

Incidentally, were we (as Britons) allowed to participate in the fiesta and have our animals blessed? Absolutely - and several English friends of ours did so. Unfortunately, we have a huge Alsatian who would ‘dine’ on other animals -given half the chance - so we could not take her! However, we did join the procession and enjoyed the lovely atmosphere - whilst openly declaring our support and committment to our village.

Wonderful!1

SPANISH CULTURE - LIFE IN SPAIN FOR THE SPANISH!

Shortly after moving to Spain, I asked a friend of mine to describe the Spanish dream (for a Spaniard) to me. This may seem an odd question but I remember feeling that if, for the forseeable future, I was going to spend my life in Spain – then I needed to understand the essence of contemporary Spanish culture. In effect, I was asking: what makes the Spanish tick? What is their motivation, day to day?

My friend smiled at me and, with no pause for reflection, said:

“In no particular order, the average Spaniard wants:
1. A decent flat in a busy town.
2. A frontline beach apartment.
3. A new Mercedes.
4. Fluency in English.
5. A job with the Spanish state.”

I was a little flabbergasted, to be honest. However, my friend was someone to listen to - given that he has lived and worked in Spain for almost thirty years. Furthermore, he is a noted linguist with a keen interest in Spanish culture and the many different aspects of life in Spain. He knows the country intimately and is constantly moving around different parts of Spain.

Of course, his assertion about the ‘Spanish dream’ was never meant as more than a gross over-simplification and, of all people, he knew that he was providing a generalisation that could never apply to every Spaniard. Equally, what he was stating was no denial of all the normal human needs and desires of us all. By these, I mean good health, happy relationships, fit children, untold wealth(!) and so on...

Over the years, I have thought approvingly about my friend’s assessment of the ‘Spanish dream’. I still have nothing like my friend’s depth of insight into Spanish culture but my experience (however narrow) of life in Spain seems to bear out his assertions. In fact, they say rather a lot about Spain and what the population want and how they live their lives. This should be important knowledge for any foreigner thinking of moving to Spain – or, at least, a helpful foundation to question over time.

So my thoughts on my friend’s assertions, given my own (limited) experience - and accepting what I say to be generalisations:

- Dismissing the easy one first: the new Mercedes. I guess we should all like one and this is nothing unusual! However, I have to say that the Spanish, old and young, seem to love their vehicles big (and new). Buying cars second hand is not favoured (thus the high price for them) and smaller, faster sports cars are rare in Spain – where in the UK they would be common.

- The Spanish are a gregarious people and like living in their towns and cities. They find commuting hard to understand, along with the isolation of living in detached houses on estates devoid of amenities. So, large, light, modern, well located flats with their own parking are highly desirable. This also goes for frontline beach apartments (which really surprised me - when my friend stated these as important). The truth is that the Spanish absolutely love the sea and Mediterranean beach life – if anything more than most Britons that I know! Indeed, during the summer they flock to the beach in vast numbers. So, a front line beach apartment is the ultimate luxury!

- In Spain, the English language has finally been recognised as fundamentally important. However, surpringly, few Spanish people are fluent, despite the Spanish government ‘racking’ up the pressure to learn English. This is now an integral and obligatory part of all schooling – including for the all-important Bachillerato (equivalent to ‘A’ Levels) and Selectivo (university) examinations. It is also increasingly being looked upon as vital to any professional for his career (with many Spaniards recognising that better job prospects and salaries are available in Northern Europe and elsewhere).

- A job with the Spanish state! Working for the Spanish state is not well paid but it provides ‘rock solid’ security once a Spaniard has passed the dauntingly difficult examinations (oposiciones) applicable to the post he wants. In effect, a state job is ‘for life’ – in a way that is even more so the case than in the UK!

So, does this tell us much about the Spanish and Spanish culture (within the confines of generalisations)? I think it does – or at least provides some idea of what life in Spain is about for the Spanish. Certainly, if you are thinking of moving to Spain and (and perhaps working here) then few things are more important than having some idea about what motivates people...1

SPANISH PROPERTY – ANOTHER NAIL IN THE COFFIN?

Probably like everyone else in Spain(!), I have just received, from a UK relative, a cutting from the Daily Telegraph entitled: ‘Expats threaten a villa “siege” as Spanish serve demolition orders’. This headline is enough to send shivers of fear down any Spanish property owner’s back.

In fact, this story concerns some eight properties in Spain sitiuated in Almeria Province (which is at the bottom, south eastern corner of Spain). It seems that the Britons concerned built their respective properties having been granted the appropriate building licenses in 2002 by their local Town Hall, the latter being responsible for planning permissions. However, the regional authority has since decided that the building licenses were illegally granted and a court has now issue a demolition order. At present, there appears to be no compensation available to the property owners.

This, of course, is everyone’s idea of a nightmare! It is also the worst possible publicity for the Spanish property industry and will, justifiably, unnerve potential international buyers.

So, what has happened?

Obviously, I lack any more details than those in The Telegraph article and a couple of other Blogs that I have read. This means that I am in no position to make any definitive pronouncements on this particular matter. However, what does seem to be the case is that corruption within the relevant Town Hall has been discovered by the regional authority. Having found this out, I can only presume that the regional authority or its court are under a legal duty to reverse the ‘invalid’ licences - and then must demolish the properties once they have been formally declared ‘illegal’.

The problem is that this is very far from the first time that this has occurred. Indeed, the Marbella scandal a couple of years ago (see my article ‘Meltdown in Marbella’ on http://www.nicholassnelling.com/) was the most high profile recent scandal involving illegally issued building licenses. In this case, the level of corruption was, literally, breathtaking - with the police eventually seizing some 2,400 million Euros of cash and assets! Corruption had, it seems, pervaded every corner of Marbella Town Hall and had probably stretched a good deal further up the administrative chain...

So, what do we draw from all of this?

Well, as a generality (however defensive this may seem) the vast majority of the problems encountered by people when they buy Spanish property can be avoided. Know the law, always use an experienced, independent conveyancing lawyer and an equally experienced (and fully insured) building surveyor before you buy anything! Furthermore, wherever possible, buy Spanish property that is Urbanizado and fully Urbanizado. Buying property in Spain in Rural areas (as I have stressed many times) almost always carries a risk – and taking any risks when you buy property in Spain is very stupid indeed.

Of course, this does not, in any way, justify the appalling corruption involved in the illegal issuing of building licences to our British compatriots in Almeria. However, I do wonder whether, before they bought their properties (or building plots), our compatriots had any knowledge of the law - or whether they used independent and experienced conveyancing lawyers and surveyors. I wonder...

I mention this because if you want to build a property in areas classified as Rural you must own a minimum m2 of land - for any new property construction to be legal. This varies around Spain but in Valencia Province, for example, you need 10,000 m2 of agricultural land before you can build a property (to a specific maximum m2). If you do not have this then any construction will be illegal - despite any attempt by a local Town Hall to issue building licences to the contrary. A good lawyer will know this and should immediately tell you.

Sadly, corruption in Spain is endemic and has affected just about anything to do with the Spanish property industry. Sometimes this has taken the form of turning a ‘blind eye’ to illegality, sometimes there has been ‘economy with the truth’ and often a straight exchange of cash. None of this is right, none of this is acceptable and every part of it acts to critically damage Spain, its economy and its perception as somewhere safe in which to live.

It would be an epic understatement to suggest that Spanish property is unsafe to buy. The vast majority of people in Spain (native and international) own properties that are problem free and have a sound title. However, it is equally true to say that there are many illegal properties in Spain and many that have potentially serious liabilities. Clearly, it is these illegal properties and those with problems that hit the news – and often with justification.

Undoubtedly, Spain has been careless and, at times, arrogant and stupid in allowing property illegality to occur. Most of it has been blatantly obvious to the authorities and yet rarely has anything been done. This is ridiculous and needs to be rectified as an absolute priority - with those responsible (or those colluding in any illegality) severely punished. Their actions damage (and have already damaged) the very economy of Spain and thereby every person living in Spain.

Unfortunately, whatever the truth with our compatriots in Almeria, they stand as an example to others of what can happen if things go wrong in Spain. Equally, although the Spanish seem blissfully unaware of this, these types of cases provide the worst possible publicity for the Spanish property industry during its most severe crisis in living memory.

The answer?

Well, there are two. Firstly, if you are a buyer: be careful and knowledgable so as to avoid being the purchaser of a ‘problem’ property – this is something I stress constantly in my ‘Move Safely’’ book together with relevant guidance.

Secondly, Spain must ‘grasp the nettle’ and create an amnesty for almost all existing illegal property. It really is way too late to start demolishing property and, although I hate the thought of any rewarding of illegality, this is the only way to clear-up, quickly, a long term, discreditable mess. Obviously, the amnesty should, on no account, extend to corrupt officials...1

LIFE IN SPAIN – CHRISTMAS IS A RATHER ODD EXPERIENCE!

This Christmas has been the seventh that we have experienced since moving to Spain permanently and it has been as oddly unsatisfactory as the others. We cannot quite ‘place our finger’ on why? It may be because our children are older and that therefore Christmas has lost its ‘magic’ - or it could have a lot to do with Spain and the life in Spain of ex-pats.

Certainly, Christmas in Spain ‘feels’ different and with some justification. The day itself is unquestionably important to the Spanish although they tend to open their presents on Christmas Eve. However, no Boxing Day is celebrated - thus leaving Christmas feeling brutally short as many people return to work immediately afterwards.

It is also true to say that Spain is avowedly a secular state with the vast majority of the population (contrary to popular myth) irreligious. This means that the ‘objective’ of Christmas is as lost to commercialisation as it is in the UK. Indeed, I suspect that church attendance in Spain is now probably close to its nadir at the beginning of the twentieth century when there were fewer church-goers in Spain than any other European country.

The odd thing is that it is not as if the overall Chrismas period in Spain is, in itself, short. It lasts until the 6th January with the all-important celebration of ‘Three Kings’. This appears to us to be as critical as Christmas day itself with the day a national holiday, widespread formal street processions and, to the delight of Spanish children, another round of presents! Meanwhile, New Year’s Eve is as important in Spain as elsewhere in the world and just as replete with riotous parties welcoming the start of the new year.

The trouble, I think, is that Christmas as an ex-pat is hard to get right because of the absence of an extended family during the holiday period. The very nature of being an ex-pat means that close family and life long friends are (obviously) not close and, as a consequence, the ‘nuclear’ family 'bit' of Christmas is inevitably missing. This may be why our Christmas’ have been so unsatisfactory despite our best efforts. Indeed, whilst I have no regrets about leaving the UK, I do wonder whether our children will have missed out on an important part of their cultural and family heritage.

Of course, the weather (in a curious way) also militates against a British ideal of Christmas. This year (in Valencia) the sun was out on a glorious day that made us all feel somewhat preposterous whilst we remained in front of a rather pointless (but attractive!) blazing fire. In our minds, of course, we imagined ourselves looking out onto snow – or, at least, a chill day of freezing drizzle and lashing wind.

I guess, at the end of the day, Christmas is always going to be different when you live in a foreign country. But then I may be looking back at Christmas in the UK, during times past, with ludicrously pink glasses! If I am not - then it is one of the very few negatives to moving to Spain.

I should also say that any maudlin thoughts as to the benefits of a British Chrismas are usually rapidly dispelled. Yesterday, I was rock climbing in shorts and a tee shirt with some British climbing friends who had just arrived from the UK. Needless to say, when not climbing, we revelled in a picnic of turkey sandwiches whilst regaling each other with stories about how wonderful it was to be warm and able to climb (a dry weather sport – if ever there was one!) despite it being the end of December.

Of course, it is impossible to get everything right when you move to another country. However, mulling all of this over with my wife, we both came to the conclusion that our life in Spain is, in almost every way, preferable to what we had in the UK. It is sad that Christmas is a bit unsettling and disappointing - but the other advantages to living in Spain more than compensate us for a it!1

SPANISH PROPERTY AND THE SPANISH BANKS

It is always reassuring for a writer when first hand experience meets gut instinct and ‘rumour’. This was recently the case when I became involved in the sale negotiations for a hotel in Spain together with an adjoining Spanish villa. Both these properties ‘belonged’ to the same owner who has sadly gone bankrupt - so the properties were the subject of formal repossession proceedings by a major Spanish bank.

I happen to know a lot about the two properties as the owner was a friend of mine and the properties are in my local area. Both properties were bought more or less at the height of the Spanish property boom and both were very heavily mortgaged. Indeed, the hotel had a 100% mortgage (as of December 2007) with the total debt to the Spanish bank – for both properties – some 1,265,000 Euros.

When (in September 2009) I was approached by someone who was interested in buying both properties I had to get in touch with the Spanish bank concerned to negotiate the possibility of a sale. Initially, I was told that the discount for a buyer would be 30,000 Euros off the bank debt. This, needless to say, was laugable - given the 1,265,000 sale price and the fact that Spanish property since 2007 has probably fallen, for the most part, in excess of 30%.

Grumbling, I was eventually passed onto the Spanish bank’s head office to the manager dealing with the repossession of both properties. After some bargaining I managed to get the initial discount bettered by around another 100,000 Euros. So, after a struggle, the sale price for both properties (if bought together) stood at very roughly 1,1,00,000 Euros. However, the 15% discount by the Spanish bank hardly made the properties a bargain – particularly as the hotel had not been open for almost a year and therefore had negligible ‘goodwill’.

My ‘buyer’ asked me to try again to negotiate down the price of the two Spanish properties. This I attempted but with a complete lack of success. I met an absolute barrier regarding the price. The Spanish bank said it was ridiculous to reduce the price further as the valuations (from 2007!!) for the two properties showed them to be worth pretty much the existing bank debt of 1,265,000. Finally, I was advised that the Spanish bank would not, under any circumstances, pay a fee or commission (to anyone) who introduced a ‘buyer’! This made any further negotiations pointless with a clear message attached...

The point of relating this is to illustrate that the ‘stories’ of the Spanish banks giving less away than they appear on their Spanish property sales appears to be true. Furthermore, clearly it is not in a Spanish bank’s interest to sell reposseessed properties when the disparity of their debt to the current value of their properties is considerable. The reason is obvious:

If a Spanish bank has a repossession property on its books it will probably not show those properties as a ‘loss’ on the ‘books’ whilst it holds a valuation (albeit an old one!) that shows that the value matches, more or less (and very much in theory), the debt. However, should the Spanish bank sell the properties (almost certainly at a loss) then on the bank’s ‘books’ the loss is absolutely and irrevocably proven. In other words, it is better for a bank not to sell some properties which have big losses attached - whilst it can maintain that the loss does not exist.

Of course, this is a book keeping exercise. However, if I am right, then it may well suggest that the Spanish banks (as many suspect) are hiding far greater losses than they have so far admitted.

Time, of course, will tell. However, I think the hotel in Spain close to me and its accommpanying villa will be on the market (but not, in reality, purchasable!) - for quite some time. It is rather sad for all concerned...1

SPANISH PROPERTY MARKET – PROPERTY IN SPAIN FOR THE BRITISH

One of the conundrums facing the Spanish property market is when Spanish property will again become financially appealing to British buyers - given the collapse of Sterling against the Euro which has affected both potential buyers and existing owners of Spanish property.

Obviously, the current strength of the Euro against Sterling has had dramatic consequences for anyone living in Spain and relying upon an income paid in Sterling. The difference between an exchange rate at 1.40 Euros to the £ and (say) 1.10 Euros to the £ is huge. In effect, the purchasing power of a UK pension in Spain has dropped by some 30% over the past couple of years. This has unexpectedly ruined the financial planning of many Britons and made, for some people, life in Spain too expensive to sustain.

Indeed, many ex-patriot Britons have had to place their properties in Spain for sale so that they can return to the UK. The danger of this is that many estates in Spain with a high density of British property owners have, as a direct consequence, a disproportionate number of properties for sale.

Of course, the more properties in Spain there are for sale in a given area the harder it is to sell (the laws of supply and demand) with any seller having to rely upon a severe price reduction to differenciate his property from his competitors. This is never more true than when an estate comprises more or less identical properties - which is often the case on ‘new’ urbanisations. To make matters worse, some estates in Spain are primarily ‘British’ and therefore unlikely to appeal greatly to other nationalities. This means that any likely buyers of Spanish properties on ‘British’ estates will largely remain fellow Britons – themselves hampered by the weakened purchasing power of Sterling.

Of course, many Britons bought their properties when Sterling was at 1.40 (or more) to the Euro. This means, very crudely, that they can drop the sale price of their Spanish property by 30% - and still get their money back (at current exchange rates).

The conundrum is obvious.

Property in Spain has fallen by (at least) 30% since the end of the boom in 2007. So, if you, as a Briton, reduce your Spanish property price by 30% (from its 2007 level) then your property in Spain is still not cheap - to a British buyer! In fact, the 30% drop in an ‘in-coming’ Briton’s purchasing power means that your Spanish property price has, in effect, not fallen at all. So, ironically, any UK buyer is going to be looking for a further price discount before he even begins to think he is getting anything like a real bargain.

In fact, ironically, Britons in Spain are not helping the vortex of falling Spanish property prices. At the moment, many are able to drop their prices by 30% with impunity – and then to drop them by a further 10% - 20% if they are prepared to take a (reasonably acceptable!) loss to extricate themselves from Spain. This is more than most Spanish or Euro sellers are prepared to countenance but acts to further destabalise the Spanish property market.

Certainly, it is no secret that the stabalisation of a property market is utterly dependent upon ‘distress’ sales being rare. Until that is the case, any property market will continue to be volatile with the emphasis being on continued falling prices rather than any marked ‘levelling off’.

In short, are prices stabalising on British owned property in Spain?

Sadly, I rather doubt it – although this could change should Sterling suddenly find sustained strength against the Euro. This would put money back into the pockets of those Britons in Spain drawing their incomes in Sterling and thereby make them less desperate to sell. It would also, as a side effect, force prices up as the Euro weakened and reduced the ability of British sellers to drop their sale prices ‘artifically’ on the basis of having bought when Sterling was strong.

In the meantime, can Spanish property offer value for money to in-coming Britons carrying Sterling worth some 30% less than a couple of years ago? The answer is a cautious yes. The unfortunate number of true distress sales (particularly on ‘British’ estates in Spain) provide some real opportunities to buy Spanish properties at bargain prices unthinkable a few years ago – even given Sterling’s depreciation against the Euro.1