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Be Glad Your Not in Spain

By
Real Estate Broker/Owner with Michael Mergell, RE/MAX Legends Group

One country facing a particularly dire situation is Spain.  One Spanish housing association believes that unsold homes in Spain could grow to 1.5 million by the end of the year.  Compare that to the estimated 1 million homes on the market at the end of 2008 - a potential 50% jump.  And with about 13% unemployment, the Spanish market isn't expected to improve anytime soon.

Two ways Spain is dealing with the housing crisis:

  • Homeowners can extend their mortgages without penalty.  For example, a 15 year mortgage could be expanded to a 20 year mortgage to lower monthly payments but increase the overal interest paid.
  • Unemployed homeowners can apply for a three year mortgage suspension.  Although this means banks won't take in payments for a few years, it does mean they won't lose money and resources due to selling foreclosures.

What do you think of the Spanish housing remedies?  Can you imagine Rick Santelli's reaction if either idea was included in Obama's housing crisis plan?

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