I've worked in the property industry here on the coast for the last eight years and I am writing this thread to start a discussion amongst the members of this group and to get your opinions. So, the question is, are we in the middle of a short-term slowdown, or is the market buggered for good?

Since I've started this thread, I'll give you my opinion. I started noticing a slowdown in the middle of '05, things trundled along for '06 and got sharply worse in '07. The whole credit crisis/Northern Rock mess hit the fan in August of last year and it has been just grizzly since then. So we are now three years into it. We've all noticed the empty former real estate offices up and down the coast, I've heard a figure of 50% of real estate companies shutting down and it sounds about right. Those still in business are struggling to make ends meet with one or two sales of second hand units a month when 10 or 20 used to be the norm. Of the previous big boys, Interrealty is gone and Viva has shut most of its offices. The sale of off plan properties is simply non existant. The news media in the UK, which sang our praises a few years ago, now take great delight in giving us a good kicking.

And yet. Agents I know still going to property shows in the UK and Ireland say that they are well attended, people still come and talk to them even if very few are willing to come down on inspection trips. They say that they still want to have a home in the sun but are put off by stories of the Valencia land grab laws, the fear that properties in Spain are not secure, that a building licence is not worth the paper its printed on. And yet they still come to traipse around the exhibition halls oogling properties. Friends in business in the UK and Ireland say that everyone grumbles about money, but they are still spending as much as they used to. So what's going on?

I believe that the problem we have is not a lack of money, but a lack of confidence, particularly in Spain. Yes, our customers in the UK can no longer treat their homes as ATM machines, the vaues of their homes may have slid but have not plumetted, their jobs are still secure. UK interest rates are dropping so that their monthly mortgage costs are slowly reducing, even if higher inflation is currently cancelling out this advantage. Most economists expect the first drop in the Euro interest rate before the end of the year. The whole Marbella corruption saga is slowly wending it's way through the legal system, but we should start to see the beginning of its conclusion by the end of this year. The new PP Marbella council under Angela Muñoz has done a great job in presenting the new PGOU (General Plan) to the Junta de Andalucia in double quick time and we should see it approved by the end of the year. At that stage a few token buildings will be demolished (Banana Beach comes to mind) but everything else will be regularised. The major global banks are working hard to identify their losses from the sub-prime debacle and should have a much clearer picture by the end of this year (are you starting to see a trend here?). They will have to start lending again soon, the business of banks is to lend money, no lending, no profit. No profit, no bonuses.

So anyway, there you have it, my €0.02 worth. I reckon that '09 will start to see a slow return to a normal situation, not of course anything like the boom years, but a steadier, more mature market. Most of the cowboys and fly-by-nighters have moved on (Bulgaria anyone?), confidence will slowly return and a four year build up of demand should start to come into force. Building work has evaporated and it will take developers a further couple of years to respond to any new demand which will mean that the current glut of built and underused properties will be slowly digested.

So what do you think?