Land in some parts of Spain is literally worthless, said Fernando Rodriguez de Acuna Martinez, a consultant at Madrid- based adviser R.R. de Acuna & Asociados. More than a third of Spain’s land stock is in urban developments far from city centers. About 43% of unsold new homes are in these areas, known as ex-urbs, while 36% are in coastal locations built up during the real-estate boom.
“If you take into account population growth for these areas, there’s no demand for them, not now or in ten years,” he said. “Around 35% of Spain’s land stock is in the ex-urbs, which means it’s actually worth nothing.”
I am staggered at what this article omits. Many, many Brits and others bought houses and apartments in Spanish coastal areas. They then discovered, 10, 15 or 20 years later, that the land on which their property was built was illegally zoned. The local city council, in cahoots with builders, would typically have rezoned land for residential building which they were not allowed to rezone according to regional planning laws. There would have been palms liberally greased to make this possible, it seems. The result? The regional governments merrily passed laws allowing them to demolish these homes without compensation. And that’s not all – in some cases the owners have to pay the cost of development. Wait, there is more. In some places the illegally zoned land was immediately adjacent to land that was properly zoned; the condemned property owners not only had to see their homes demolished but had to pay a share towards improvements on the adjacent land (roads, sewers) (don’t ask me to explain the justification of this – it is so bizarre). Literally hundreds of thousands of Brits and Germans had bought in Spain and more were poised to do so – but when the horror of the above was revealed, needless to say potential purchasers began staying away in droves and have never been pack.