Banks & Builders Want New Property Bubble In Spain, Government Obliges

Banks & Builders Want New Property Bubble In Spain, Government Obliges by Don Quijones • Mar 29, 2018 • 12 Comments “This plan, far from solving or alleviating the problem, is likely to make it a whole lot worse.” By Don Quijones, Spain, UK, & Mexico, editor at WOLF STREET. Spain’s second biggest bank, BBVA, just announced that it’s resurrecting the 100% mortgage, a high-risk loan instrument that notoriously helped fuel Spain’s madcap property boom. For the first time in almost a decade, property buyers will be able to receive credit equivalent to the total value of the property they wish to purchase. As before, no down payment will be needed. But this time, interest rates will be even lower. Despite boasting the largest stock of empty housing in Europe — 1.36 million units at last count, almost a quarter of them belonging to banks and investment funds — Spain’s economy is being primed for another property boom. Real estate developers and builders want it and banks need it, not only to fatten their NIRP-eroded margins but also to dispose of some of the real estate assets still lingering on their books from the last crisis.-Read more:https://wolfstreet.com/2018/03/29/banks-builders-want-new-property-bubble-in-spain-government-obliges/