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Spanish Real Estate companies in crisis
Real estate news By h.b.
Oct 8, 2007 - 8:08 AM
As many as 75 percent of agencies could close between 2009 and 2014 according to a new report Three in ten real estate agencies in Spain are set to close this year, as the sector enters into a crisis following a fall in demand. It’s now forecast that there will be a 20% fall in sales this year, and the construction of new property will be 2.5% lower.
The President of the Network of Real Estate Experts REI, Eduardo Molet, has said that his has been on the horizon since the start of 2007 and will continue until the end of the year. He said that more than a third of the 60,000 real estate promoters in Spain will have problems next year. A survey from the network says that as many as 75% of agencies could close between 2009 and 2014. Molet said this year would end with 700,000 new homes built in Spain, a crazy number if compared to the rest of the EU. In the U.K. for example the number is only 187,000.
Currently there are 3.1 million empty properties across the country, according to the National Statistics Institute, and this number will only increase unless there is more demand. Already some companies are in trouble. Six companies from the Valencia Group Llanera have applied for bankruptcy protection. The company’s debt was 748 million at the end of last year.
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