Spain's villa values HALVED and UK immigrants can't afford to come home

Add to My Stories Seven years ago, Marian Henderson moved to the south of Spain with 1million in her pocket.But when - or perhaps that should be if - she finally makes it back to Britain, she will be lucky to do so with one quarter of that sum.Shes no spendthrift - the money she has lost has been on bricks and mortar.

Out of pocket: Seven years ago, Marian Henderson moved to the south of Spain with 1million in her pocket. She will be lucky to return with one quarter of that sumHer home, a beautiful four-bedroom country house surrounded by orange groves, a swimming pool and stables, was once valued at 725,000. Today, it is on the market for just under 270,000.
I have cut the price as much as I can, says Marian, 62, who put the property up for sale shortly before her husband John died in 2007.
But it doesnt seem to have made any difference. I am desperate to leave Spain, to get out of here. But the market has totally collapsed, and until I can sell my house, I cannot afford to leave.

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It is terrible because while I am here, I can hardly afford to live. I am surviving on the basic state pension and barely have enough to eat, let alone go out - I can go three or four days without speaking to another person.
I am on anti-depressants and I tell my daughters that if I dont sell, they wont only be taking their dads urn home but mine as well.Marians is a desperately sad tale, but, unfortunately, it is not an unusual one.
Across Spain, the British expat dream is fast turning into a nightmare.Having left these shores in the hope of finding a better life abroad, a legion of Brits have instead found themselves caught in the mids! t of an economic storm.
The properties in which they invested have fallen in value by as much as 50 per cent in the past four years. This is down to massive over-supply. The Spanish government estimates there are 700,000 unsold new-build houses across the country.Of these, 400,000 are on the coast, the vast majority in the south of Spain where many British people have bought properties.Take into account the fact that there are the same number of older homes being advertised for sale, and it is little wonder that experts are predicting prices will fall by another 20 per cent on average over the next five years.As the property bubble has burst, so the rest of the Spanish economy has suffered. The banks are sitting on vast amounts of bad debt, while the construction industry has collapsed.Reports recently showed that of 60,000 property sector companies, 23,600 have gone bust, with debts of more than 100billion.

Selling to Brits was a licence to print moneyAs a result of this economic turmoil, Spain is now in the midst of its worst recession for 50 years. A record 4.6 million Spanish workers, or one in five, are now unemployed. This figure is the highest in Europe.

And if that werent bad enough, many British expats, particularly pensioners, have been hit by the weakness of the pound against the euro. Where a 10,000-a-year pension would have been the equivalent of 16,500 nine years ago, today it is worth nearly 5,000 less.Hardly surprising, then, that so many Britons are desperate to bail out and return home. Companies that specialise in exchanging large sums of money - such as the proceeds from a house sale - have seen a 50 per cent increase in transactions linked to repatriations.More would doubtless follow - if only they could sell their homes.If the house being sold is in a prime location and in a good condition, it will be sold for about half what it was worth three or four years ago, admits one estate agent operating on the Costa del Sol. If it isnt either of the above, and that applies to a l! ot of ho uses, then it wont sell.
During the ten-year building boom that ground to a halt in 2007, selling the British a place in the sun was a licence to print money.
All along the south coast, streets of white-washed houses, known as white villages, appeared - and were snapped up by eager British buyers.
Of all Spanish properties sold to foreigners, Brits were behind one in three of the purchases.

Stranded: Marian's problems were exacerbated by her lack of income and the falling pound against the euroMarian and husband John, a builder, were among them. In 2004 they sold their home in Navestock, Essex, for 875,000 and headed south, bringing with them another 125,000 in savings.It was always Johns dream to live in Spain, says Marian, who has four children and nine grandchildren. I was happy where I was, but I said to him that if he matched what we had in England - the house, the land and the stables - then I would come.And, in Finca Bonita, match it he pretty much did. The property is on the outskirts of the village of Coin, about a 30-minute drive inland from Marbella, and cost the couple 550,000.After extensive and expensive renovations it has four bedrooms, three bathrooms, a pool and stabling.
Initially, life was as good as the couple had hoped it would be. The weather is fantastic and we lived really well, going out for meals and for day trips a night in was a rarity, says Marian.
The couple supported themselves with their savings and also from the income from a part-time lorry-driving job John took.
But when, in 2007, he was diagnosed with cancer, they decided they would move back to Britain, and so put the house on the market. It was valued at 725,000. But it didnt sell, and later that same year John died.
Dealing with the bereavement would have been hard enough for Marian without the dawning realisation that selling the house was not going to be as easy as she had ! first th ought.
As the recession hit, the viewings just dried up, she says. I reduced the price more and more, but still I didnt get any offers.
Her problems were exacerbated by her lack of income and the falling pound against the euro.
All my savings have gone and I am relying on the British state pension, says Marian.

'I cut the price more but got no offers'Ive looked for work but there just isnt any. If you go for an interview and there are five Spanish people and one British person, theyll have the five Spanish first. You cant blame them, but that is just the way it is.

As for help from the government there is nothing. If I was in England I would get help with the council tax and pension credits, but because I am in Spain there is nothing. They dont hand out anything for free here - its terribly depressing.Further along the coast and that sense of isolation and helplessness is shared by Rob Dawson.In 2002 he and wife Anne sold their two-bedroom house in Canvey Island, Essex, for 113,000 and moved to Spain.They used the money to buy a recently-built four-bed villa in four acres of land in the village of Barxeta, close to the Costa Blanca. A further 60,000 was spent doing up the property.Im a ceramic tiler and the idea was that I would carry on working in Spain, says Rob, 51.
Just about every surface in Spain is tiled so I thought I would be made.For the first four years there was plenty of work but then the credit crunch struck and the construction industry ground to a halt. As a result, for the past two years Rob has barely worked at all.
Ive taken my CV to factories and other businesses but there are just no jobs, he says. The only thing I have been offered is some part-time work picking oranges for 17 a day.
Seeing that the writing was on the wall, three years ago the couple put their house on the market. The asking price was initially set at 235,000, but has gradually been reduced to its current one of 104,000.
But still with no buyers and with no money coming in,! Robs wi fe Anne has been forced to travel back to Britain to find work as a live-in carer for the sick and elderly.She is over there at the moment and will be for two months, he says. We have to pay about 300 a month for the mortgage and then there are living expenses and things like the car insurance and the MoT to cover. She works to raise the money and then comes home. Its hard, but what else can we do?

End of the dream: Seeing that the writing was on the wall, three years ago the Rob Dawson and his wife put their house on the market. The asking price was initially 235,000, but has gradually been reduced to its current one of 104,000On Valentines Day we had to speak on the phone, and weve had birthdays and Christmases apart. Life at the moment isnt exactly the dream, adds Rob.
I live on 85 a month and spend my time walking the dogs and doing the cleaning. Id leave the house if I could but weve been burgled twice, so Im stuck.Of course, ones mans pain is anothers pleasure. Rock-bottom prices represent an opportunity for investors with cash to spend. The local English-language paper has pages of knock-down properties.Bargain: new villa, reads one. Four bedrooms, four bathrooms, 350sqm. Reduced from 1.45m to 720,000.Another: Steal this beautiful south-west facing family villa. Stunning sea views, large garden and pool, four bedrooms, three bathrooms. Was 1.2m now 620,000.And a third: Luxury two-bed/bath penthouse apartment with use of golf, gym, tennis and spa. Reduced by 150,000 to 169,000.According to Nikki Powles, 44, an estate agent whose company Spanserv.com has been selling properties in the province of Andalucia to the British for the past 11 years, canny buyers are beginning to return to the market.It is a good time if you have got the cash to buy, she says. We are seeing Germans, Dutch and others from Northern Europe, plus a few British. They want a bargain of 50 per cent or more all the ho! uses I a m selling are half price.
The difficulty is that with the over-supply, only the best properties are selling. Those in poor locations or with even the slightest question mark over their legality are being ignored, however hefty the discounts.
The problem of properties built without the proper permission is thought to blight as many as 100,000 on the Spanish coast, some of which have already been demolished.If the property has even a hint of a difficulty about it, even if it could be sorted out quite easily, the lawyers are steering prospective buyers away from them, says Nikki.Her insight into the property market comes from both professional and personal experience.

'People should sit tight for at least two years'Nikkis 66-year-old mother Lesley and grandmother Barbara, 91, moved to the south of Spain from Hampshire six years ago, buying three properties between them one each to live in and one as an investment.
With her grandmothers increasing age, the plan had been to sell all of them and invest in an apartment suitable for the pair to live in together.
But two years since they went on the market, none has sold despite heavy discounts (one apartment has been reduced from 235,000 to 126,000).I never thought the market would drop in the way that it has, says Nikki. I would say to people who find themselves in this situation that they are going to have to sit tight. It is the only thing they can do. I reckon that in maybe two years time things will start to even out.
It is not easy. My mother is very frustrated here. There is no longer any community spirit in the village.
We used to go out to the bar and the restaurants to meet people and to have a coffee and a meal. But now, no one can afford to do that neither the Spanish nor the British. People just stay in.Of course, some will argue that those who are suffering today are doing so because they chased a dream and in doing so were blind to the magnitude of the risks they were taking.The truth is that the credit crunch and t! he depth of the recession tookpretty much everyone by surprise, not just in Spain but across the world.But for those stuck, often alone and a long way from home with diminishing wealth and often failing health, that will come as little consolation.