First, I want to share with you that I will not be leaving in May. My monthly support is at about 77%! I am in need of $400 a month. That's it! I will be here for a bit longer though to finish raising these funds and to finish applying for my Visa. I am excited to be here a little longer and have some transition time! However, please pray for expedience and for the proper documentation to arrive soon. More details to come ; )
This is an interesting article I found on the International Herald Tribune. I think this article does a pretty good job of showing the problem and what this communicates about the government and corruption.
Thousands of homes in Spain threatened with demolition
By Sharon Smyth Bloomberg News
Monday, May 5, 2008
Leo Levett-Smith and his wife, Jean, thought they did everything right when they bought their retirement home in Spain. They used a registered real estate agent, a Spanish notary and obtained their mortgage through one of the country's largest savings banks.
Then in January they received a demolition order saying the house had been built without a permit.
"We really believed we had taken all the necessary precautions," said Levett-Smith, 65, a retired traffic policeman from Cheshire, England, as he sat on the porch of the russet-colored villa in Catral, 42 kilometers, or 26 miles, southwest of Alicante. "I mean, where else have you heard of this happening?"
Over the past decade, developers built about 100,000 illegal homes in Spain, and consumer advocates say that because of the technicality, thousands of those are now threatened with demolition as regional governments try to deter clandestine construction. The crusade may discourage the foreign buyers who fueled Spain's housing boom and deepen a slump that began last year.
"The problem is very serious," said Rafael Pampillón, an economics professor at the Instituto de Empresa in Madrid. "When a country has a system or set of institutions that allow illegal houses to be built and corruption to exist, then evidently foreign investment is going to flee."
At least one house has already been bulldozed. In January, Len and Helen Prior lost their three-bedroom villa in Almeria. The 63-year-olds from Berkshire, England, paid £350,000, or $690,000 at current exchange rates, for the house in 2003.
Each of Spain's 8,111 town halls has the authority to make planning decisions and issue building permits with little oversight from the regional or national governments. As property prices soared, some local officials were drawn into plans to profit from new home construction.
The former head of urban planning in Marbella has been charged with money laundering and accepting bribes to issue building permits. When the official, Juan Antonio Roca, was arrested in March 2006, police seized €2.4 billion, or $3.7 billion at current exchange rates, of assets, including two hotels, sports cars and 103 horses. Roca has denied any wrongdoing.
"When everyone is making money, for example the real estate agent, the town hall and the administration, everyone turns a blind eye," said Bernardo del Rosal, a former ombudsman for the Valencia region. "The system as a whole fails and the law is worthless when that happens."
The local governments with the largest concentration of new housing, including Valencia, Alicante and Marbella, declined to say how many homes might be destroyed in their communities. Andres Lara, a spokesman for the Spanish Housing Ministry, and officials at each of the 17 regional governments referred questions to the municipalities.
Government officials will not provide figures because it puts them in an "abysmal light," said Bernardo Hernández Bataller, a Spanish lawyer and president of a European Union committee that advises on financial services and consumer protection.
"It's safe to say the demolition orders could run into thousands," Bataller said.
Home prices almost doubled in the eight years through 2006, as buyers took advantage of a booming economy, stable employment and low borrowing costs. About two million foreigners own property in the country, according to Ciudadanos Europeos, which works to protect the interests of Europeans in Spain.
Spanish residential property prices fell in real, or inflation-adjusted, terms for the first time in more than a decade during the first quarter, as interest rates rose and banks tightened lending because of the global credit squeeze.
The number of foreigners and non-residents buying homes in Spain fell 42 percent last year, according to the Housing Ministry. Their share of total transactions slipped to 9.5 percent from 12 percent.
The slowdown in the housing market, which represents 9 percent of gross domestic product, is rippling through the economy. The International Monetary Fund has said that Spain's gross domestic product would expand 1.8 percent in 2008, less than half last year's pace, and that unemployment would rise for the first time in more than a decade.
"The bad press and examples of corruption have done nothing to help raise the confidence of international investors," said Miguel Martín Rabadán, general director of PricewaterhouseCoopers in Spain.
The Levett-Smith's story is a parable for how exuberance and greed drove corruption in the Spanish housing market. The couple moved to Spain seven years ago, initially settling in a village near Torrevieja on the Mediterranean coast. When the area became too crowded, they decided to move inland.
In 2005, the Levett-Smiths bought their three-bedroom house in Catral, paying €220,000 to Country Life Properties. The property is one of the 1,270 homes in the community that were built with insufficient permits issued during the 12 years that José Manuel Rodríguez Leal was the town's mayor. Some 160 homes in Catral have been served with demolition orders.
Among the companies that built the homes was Grufade, a developer registered in the name of María Ángeles Rodríguez Leal, the former mayor's sister, according to a complaint filed by the European Association for the Protection of Urban Consumers. Grufade's sales rose to €1.7 million in 2006 from €3,900 two years earlier, according to filings at Alicante's mercantile register.
Rodríguez Leal resigned in January 2007, and his party was defeated in local elections the following May. A court in Alicante is investigating corruption charges against Rodríguez Leal. According to the online newspaper 20minutos.es, there are 93 similar investigations in Spain.
Rodríguez Leal had denied any wrongdoing, saying that the blame lies with his brother-in-law, a builder by trade. "Permits to build sheds and shelters were authorized, but when I realized they were being used to build houses I tried to stop them," Rodríguez Leal said. "But they wouldn't, and I was powerless."
María Ángeles Rodríguez Leal and her husband declined to comment, according to a woman who answered the phone at Grufade's offices in Catral.
The Levett-Smiths tried to avoid the pitfalls of Spain's property market by hiring a Spanish notary to oversee their transaction, getting a €130,000 mortgage from a Spanish savings bank, Caja de Ahorros del Mediterraneo, and paying €300 for an independent survey. No one informed the couple that the building permits were illegal, the Levett-Smiths say.
Antonio Bellido, Catral's new urban planning counselor, is trying to stop the bulldozers. He has proposed charging owners of illegal homes €5 per square meter, or 11 square feet, to have their houses inspected and incorporated into town plans. That could raise €15 million for Catral based on Bellido's estimate that the illegal houses occupy 3 million square meters of land.
"Right now, Catral is infamous for its illegal houses," Bellido said. If the regional government approves the plan, "Catral will become famous for being the town in Spain that found a solution to a mighty problem."
If the Levett-Smiths lose their home, they will have to return to Britain and live with their daughter.
"No one in their right mind would give us a mortgage at our age to start again," Leo Levett-Smith said.
So, when are you leaving? The best answer is, whenever the Lord wants me to! I hope to be in Úbeda by August 1st. Regarding monthly support, I'm at 77%! Thank you! I am still in need of $400 a month. In light of the whole, being only $400 away is so encouraging. I'm still waiting to receive documents from Spain which I need to take to the Spanish embassy in Houston to finish applying for my Religious Worker visa.
