The international Spanish property market is now certainly feeling the Brexit effects, writes Campbell Ferguson.
Agents, lawyers and surveyors are noticing that potential buyers and clients are putting off their commitment to purchase until after the result.
FX companies are reputedly expecting a 20% drop in value of the pound against the US dollar if Britain does leave.
It will be large against the euro too, though the EU will have such problems with the UK’s pending departure that the euro could fall just as steeply.
And it will continue to be uncertain for a further two years as apparently there is a ‘cooling off’ period for negotiation, after a decision has been made, during which there is the possibility of any decision being reversed and the UK being ‘permitted’ to stay in.
Can any benefits be worth all that hassle? Some obviously believe so and, as I write, the certainty of the vote deciding to leave, based upon betting money placed, has risen from 15% to 25%.
But how did I get onto this topic?
Well, it must be the macro-economic training of my Land Economics qualification from long ago. Looking at the bigger picture and how that’s going to affect individuals – and also how the actions of individuals can affect whole populations.
A decade ago I gave a talk about how the actions of individual developers and owners were spoiling the countryside with developments and individual ‘campo’ casas appearing like graffiti in beautiful valleys and hillsides.
Could they not see that these developments were destroying the natural assets that were attracting the people in the first place?
This ‘progress’ was stopped by the recession, but now that the market is getting stronger again, and if Brexit goes the ‘right’ way, that will continue.
There are indications and cranes popping up in increasing numbers.
Will there be false confidence in the insatiable desire for the whole world to come to Spain, now that tourist demand for Spanish and Portuguese destinations is apparently 30% up on last year. These people must be wooed to generate a loyalty to these Costas and not be treated as a never-ending resource to be fleeced with high prices and off-hand attitudes. Hopefully these days are past, but I have my doubts as individual greed is a culture hard to stop.
And that’s evidenced by the proposal for a compost factory behind Cancelada, Estepona.
For the sake of an individual promoter plus probably a few other ‘beneficiaries’, a whole valley’s attraction could be destroyed.
Many hectares of land, environmentally suitable for development that will take pressure off areas of high landscape value, could be sterilised by an environmental disaster in the making.
And that’s not counting the thousands of existing homes that will be affected, potentially destroying the quality of life and health of tens of thousands of permanent and holiday residents.
The economics don’t make sense in the location proposed as it can’t be profitable and meet the environmental requirements.
Estepona will be sterilising land where development could bring much-needed revenue.
Ah, but maybe the EU will come to the valley’s aid and stop this foolishness. Like with the referendum, we wait and hope for common sense to triumph.