as we all know the resort is way behind schedule and seems to be dropping further and further behind.....Though people say (especially those who bought on AP-4 & 6) 'im glad its delayed as i wont have as long to pay my mortgage before the resort is finished' BUT surely if the resort as a whole is behind schedule wont the length of time be the same?!? My other question is - does anyone have in their contract a clause stating when their property should be finished and any penalties if it is X amount of time late?
Alant, You are exactly right about delays. It was a mistake for people not to have a time delay clause in their contract. Maybe nothing can be done for those who have already signed, but anyone wishing to buy from now should insist on one. You have been warned.
I am buying a 2 bed apartment on RT-6 and requested that the contract be amended to state that I can back out completely if they are unreasonably delayed. LJDF have so far refused to do this and seem to think (like many do) that it is only a good thing for buyers if there are delays! Not so - after the second installment they will have over £70,000 of my money that could otherwise be earning interest or invested elsewhere. I would be interested to hear if anyone has had any success in getting there contract amended re delays or if they are in the process of trying.
Originally posted by Karen106: LJDF have so far refused to do this and seem to think (like many do) that it is only a good thing for buyers if there are delays!
Why do other people buy that? Because it is what the developers tell them?
There is also an opportunity cost of a delay - having to pay rent for longer on your current place or whatever. That's what you should be compensated for.
Or, sooner it is ready, the sooner it can be earning rent too (if that is your chosen route).
This can be, as always, be changed with "people power". If enough new buyers insist on a lateness clause then there will be one. Flood the forums with "people power". I believe it is a good investment, but do not want my investment delayed by an unknown amount of time.
I agree with the sentiment here and would add that your large deposits are earning no interest and are not guaranteed while being exposed to the riskiest phase of the project. As a suggestion, you should at least start to earn interest once the developer starts delaying beyond the originally suggested dates. Only problem is that such a clause will increase the risk of the developer failing and could end up losing a lot more than your interest.
The time to discuss/negociate T & C's in the contract with the developer or their appointed agent, is with your own legal adviser before you sign!
There are tens of thousands of buyers in Spain, Ireland and the US who bought off plan for whom a delay (due to falling prices) is not a benefit. As the comming Global property crash unwinds this will spread to all specuinvestor markets where Uk investors have driven asking prices to levels unsustainable by fundimentals.
The time to discuss/negociate T & C's in the contract with the developer or their appointed agent, is with your own legal adviser before you sign!
So should I get my lawyer to liaise with LJDF when they have allready said that they are unwilling to add such a clause - Is a legal adviser likely to make progress where I haven't? Also, is it worth actually going ahead with the purchase at all knowing what I know about the property crash in Spain and the fact that there are allready delays in the resort?
Originally posted by Pablo Silver or Lead?: all specuinvestor markets where Uk investors have driven asking prices to levels unsustainable by fundimentals.
Can you name one place where this HAS NOT happened?
Also, is it worth actually going ahead with the purchase at all knowing what I know about the property crash in Spain and the fact that there are allready delays in the resort?
This only you can decide... If the price at completion is lower than the initial price by more than the value of the deposit, then it is worth giving up the deposit.
you and or you lawyer are not in a very strong negotiating position if you have already signed a contract with T&C that you are now not comfy with. Why would the developer allow the change and give you the right to walk and presumably recover your initial deposit from them?
You need to take a value judgement as to whether your cost of walking (presumably loosing your initial deposit by breeching your contract, that being failing to pay the next instalment and not honouring the contract as initially agreed) is going to greater or less than going through with the purchase and therefore carrying the ownership, finance and operational costs on a property that is underwater and likely to fall in value for the foreseeable future?
We need to put this discussion into some kind of context. Although contracts have been signed without any delay clause, there must come a time when a european court would deem that the time delay is unreasonable. Can you sign a contact, with a proposed finish date of July 2006( not mentioned in the contact,) and then find it is not ready until July 2010. without any legal basis for a claim. My point is that we are dealing with european companies, who come under european law. If there has not already been a test case, when this has happened before, then being the first will not do anyone any more harm. Morocco believe it or not, also has a legal system. and at this crucial stage for them would not want negative publicity. Why not write to the moroccan government itself and ask what they would call a reasonable delay;
Interesting concerns have been raised on this post in relation to completion, this is how I see the situation, I believe Saidia is due for completion in 2010, this is the year the King wishes to attract 10 Million visitors & for that fact alone i am sure the govt will be very keen for this resort to be complete on time, yes some of the Fadesa apartments are behind Schedule but I do think by 2010 the resort will be completed, if the "3" developers find they are running behind schedule near 2010 I am sure more rescources will be bought in.
Saidia is the first development most of the developers are working on in Morocco, im am sure all these developers will want to ensure its sucess in order to then "bid" for other projects, failing to deliver their first project on time will not help their case hence the reason I think most plots will be complete to deadlines.
Also mentioned was the worry of prices falling as Spain is currently experiencing this slowdown, I totally disagree on this, prices in Spain have been rising for the last say 20 years, Morocco has only recently been intorduced as the place to buy property for investment, I see prices in Morocco rising aprox 15% per annum for atleast another 3-5 years.
You can not compare the Saidia resort to resorts in Spain, I would say a similar "spec" resort in Spain frontline to the Med will not see any depreciation in Value at all, a £150k apt on Saidia on an eqiv exclusive resort in Spain will be aprox £400k
Thorr, etc any input, do you believe I am correct in stating the above?
Spain is at the begining of a crash that in my opinion will be much worse than the 1989 to 1995 one. All leading indicators (property, sentiment and micro/macro economic) point to this. I agree quality properties on quality developments will hold up better than secondry and sink developments, but it's all relative.
The whole Spanish market will be affected such as Spanish inland, rural and city. The costas favoured by the Brits and other northern European will be hit the hardest.
There will be so few buyers relative to the amount of sellers (many distressed/walked away/repo'd)many places will effectively be unsellable. I predict that peak to trough price falls on the best developments will be circa -20 to 30% (it could be a lot more if there is a general financial crisis due to the Euro straight jacket and the governments errors)but for the middle range 2 bed golf appartment bought off plan in late 2004/05/06 well we'll be looking at drops of -35 to 50%.
Hi, Thanks for the reply, but do you think Morocco will be affected? i personally do not, I think it may encourage people to possibly buy in Morocco rather than Spain.
At this moment in time the developments in Morocco are all front line beach etc, give it 5 years newer development will have to be inland, this is when people will really start to realise how well they have done in buying frontline & on "Plan Azure" Resorts.
I do think the Spainish and Morocco markets are linked. You cannot say that the property market in Morocco compares favourabley in Spain and then say it is not linked. Morocco is still an emerging market and although the region is hoping to attract 10m tourists that is not guaranteed! If the estimated number of tourists do not appear, there will be no further development within the region.
If there is a property crash in Spain I really do not think that will encourage people to buy in Morocco. Unless there is a price correction within Morocco to reflect the decrease in Spain. People will be more willing to buy in a mature market like Spain rather than risking an investment in an emerging market.
People have been buying in this development because the price compared so favourably with Spain. But if there is a crash in Spain then surely Spain starts to look more attractive and prices will have to drop in Morocco.
The six years of artificially low interest rates following the dot com crash and 911 are over. Property prices in the western economies and emerging markets were driven artificially high by discretionary purchasors clamoring to borrow to 'invest/sepeculate' on the basis it was going to continue. To compound the problem the lenders have been very lax in their risk management and have prety much lent money to anyone with a pulse. Now with the hangover of arreas, bad debt, bankruptcies and repos just getting started, they are bolting the stable door after the horse has bolted.
So with the price of money increasing and credit tightening (globally)prices/values will return to the mean. That means falls across the board.
Asking will Morrocco be affected by what unfolds in Spain over the next 4 to 5 years or so; is in my opinion like asking will The Bahamas be affected by the Crash in the US (and anyone who is still in denial about the breadth and scale of the correction getting under way there is a naive fool).
Unlike base demand (for a home) discretionary demand can and does disapper overnight, driven totaly by sentiment.
I think the market/prices in Morocco will not be insulated from either the Spanish or more importantly global correction we are just starting to witness.
Its been interesting watching this thread develop from my original posting.... pablo... your apocolyptic view of property prices simply will not happen, why?... the western economies are strong, there is no recession... employment is high, inflation low, interest rates are low. And of course; bottom line - theres more and more people on this place we call earth and it ain't getting any bigger!
You sound very sure that there won't be a property price crash. What about the IT stock market crash ? The economic indications were the same as you describe in your email but the stock was overvalued and there was a simple market correction. Who is to say that won't happen in overseas property where prices have been inflated by UK buyers using equity from their UK properties. It may not happen but you never be certain.
Hi, firstly....people power is interesting as a concept but in order for it to operate people have to be open in their willingness to share information. I have found that many on these forums seek info but not very willing to give it.Secondly , regarding the situation at Fadesa , I think a private investors website is now essential but I do not have the expertise to set one up....Can anyone assist? Thirdly, fadesa have already succeeded in playin 'divide and rule' with clients by giving different contracts depending on when you bought and by cleverly researching their main investors and playing to those who are happy about delays in order to stave off paying mortgages. These people are professional investors and I am concerned about the genuine private investors who do not necessarily share these forums and who may be seeking to retire, make a home, or holiday with their family. These people are being ignored and taken advantage of. In view of this I have started the legal process in Morocco.....if anyone else interested please let me know......I have found that property lawyers in the UK know very little about seeking remedies in Morocco...if the delay has affected you personally then the opinion in Morocco is that it doesn't matter what the contract says...the intentions are clear and you actually purchased a promised lifestyle which has not been delivered.....It actually helps enormously if you have a clause which states how many months after signing the compromis de vent they promise to deliver. I signed in April 2005 with a promise of delivery fourteen months later......I believe others may have 21 months in their contracts.
Originally posted by alant: Its been interesting watching this thread develop from my original posting.... pablo... your apocolyptic view of property prices simply will not happen, why?... the western economies are strong, there is no recession... employment is high, inflation low, interest rates are low. And of course; bottom line - theres more and more people on this place we call earth and it ain't getting any bigger!
Everything you say does not have any connection to reality.
Interest rates were lowm, they are increasing and will get back to quite high figures. Unemployment will rise.
Anybody who is not igonarant knows that there is an ongoing property crash in USA and a coming one in Spain.
The prioces is MOrocco were artificially high from the beggining based on the ultra-high Spanish ones. When the Spain prices will be 40% lower, there will be no incentive to buy in third world countries instead of EU countries.
Then only people who really love Morocco will buy there, the "investors" will dump their properties like they do with dirty laundry.
The same is happening now in Turkey and same will happen in Cape Verde, etc.
