With the global credit crunch coming hot on the heels of property scandals, the Costa Blanca property tough run is continuing.
But, with agents desperate to attract your business, this could be a great time to buy.
Over the past 40 or so years, sleepy fishing villages and port towns on the Costa Blanca, have turned into bustling towns; and bustling towns have turned into frenzied cities. Still there's something truly charming about this part of Spain, and that's a fact that has not gone unnoticed by the many thousands of Brits who have bought Costa Blanca property, whether for investment, holidays or retirement.
That said, three years ago, Spain was getting a lot of bad press over rotten government officials swindling holiday homers, dubious developers scamming investors, and the government doing itself no favours with its unfortunate tendency to make property owners pay to have their land taken away from them.
To pour a little fuel on this fire, a feeling began to grow among British investors that perhaps they were no longer making their money work for them by paying top euro for a property for sale on the Spanish costas.
On the Costa Blanca, the property ostriches were busy burying their heads in the sand and this was the icing on a bitter cake: many properties that could have been sold at the right price simply languished on the market.
Agents now changed their tack, pitching their marketing more at the holiday home buyer than the investor, and singing the praises of the Costa Blanca as a lifestyle choice. To a certain extent, this worked: with warm seas, sunny skies, plenty to do, day and night, and more speedy and cheap flights per day than you could shake a stick at, the Costa Blanca is a serious lifestyle option for fed up Brits.
Nevertheless, as the economic situation worsened in Britain, and property buyers became more nervous and hesitant, property prices should have come down but didn't. Now some of the biggest agents in Spain are on the ropes - or out for the count.
So what does it all mean for the Costa Blanca property market and the decision to buy property on the Costa Blanca?
David Blackwell of Headlands International says: "Demand for property in Spain is not as high as it has been in recent years, but it's still the number one location with Brits looking for a second home. Despite the problems British property buyers have with a strong euro, and buyers reducing their spending, analysts predictions are that the Spanish slump is only temporary, and now is a good time to buy Spainish property in a flat market."
Blackwell believes those investing in a flat market are more likely to find property prices attractive, and adds that at Headlands two out of three enquiries for Spain are Costa Blanca-related.
Of course, prospective property buyers on the Costa Blanca are unlikely to be wooed by anything less than great property prices, key-ready properties, winning locations and excellent build quality. Agents and developers are going to have to do something dramatic to make their properties appeal to Brits who are sitting on substantially less equity in their British properties than at this time last year. Witness Headlands, which, as part of its own 'dramatic' response, has joined forces with huge developer Taylor Woodrow Espana (the company has since merged with rival George Wimpey to create Taylor Wimpey) to package an aggressive pricing policy, which offers property buyers of ready-to-move-into properties discounts of up to 30 per cent.
This is obviously going to compensate for our home grown property and euro exchange woes, but will it do the trick? And will other property companies be able to follow suit?
It's possible that the choice will be taken away from them as a property glut looms. At a recent conference in Valencia, the director general of the Bank of Spain, Jose Luis Malo de Molina, said: "The number of new homes this year will hit an all-time high."
This record breaking feat is definitely not going to earn applause from current owners of Spanish property, who are almost certain to see the value of their investment fall. Potential property buyers, on the other hand, may feel the time is right to go in for the kill. Distressed sales are on the up, as are repossessions; and in this buyer's market, those who can afford to play the long game will see some high quality property being offered at prices that would have been called giveaway a year or two ago.
The consensus among property agents at the moment is that prices will stabilise late this year or early next, but, due to the glut of property on the market, it will take considerable time for the market to return to last year's highs.
As would be the advice in troubled markets the world over, they suggest property buyers seek out better quality property in areas that are most likely to hold their value.
In the case of the Costa Blanca there are number of good candidates.
Moraira, a pretty town just south of Javea in northern Costa Blanca, has fended off the worst ravages of tourism, possibly because its sole beach is far from the best in this part of the world. The town itself, though, has many charms; and some really good restaurants and bars, and superb beaches can be found in nearby Javea and Denia. Prices of property in Moraira have fallen by as much as 15 per cent, but upmarket developments here are holding their own. Apartments with two bedrooms are currently selling for between €150,000 and €250,000, while villas will fetch between €350,000 and €650,000.
A little further down the coast, towards Benidorm, the town of Altea has fared a little better, with prices of property in Altea feeling a downward tug, but certainly not in freefall.
Altea can genuinely claim to be that awful cliché: a taste of the real Spain, with its Medieval heritage proudly on show in its cobbled streets, its picture-postcard old quarter, and a relaxing palm-lined promenade.
The town is a mere 12 kilometres from central Benidorm, but the pubbers and clubbers of that particular hotspot are unlikely to find what they're looking for in this laid back destination. A number of upmarket developments reside here, the most prominent of which is Altea Hills, which has a number of resale properties available, including a harbour front apartment on the market for €220,000.
Much further south - and a world away from genteel Altea - lies Torrevieja, which has been rolling out the Watney's Red Barrel for donkey's years. Fun-loving Brits have always adored this town, which has some excellent beaches (Blue Flag, no less), as well as a wonderful micro-climate (apparently partly due to the nearby salt lakes), which draws sufferers of all manner of aches and pains from across Europe.
Having said that, the town has already suffered a 15 per cent loss in its average property price, but there is a consensus that this short, sharp shock may help Torrevieja to bounce back rather more quickly than other parts of Spain. Currently, well positioned, two bedroom apartments in Torrevieja are selling for around €250,000, while villas are averaging around €500,000.
Elche, some 25 kilometres from the coast but only 12 kilometres from Alicante airport, is perhaps not as well known as it should be to the Costa Blanca fraternity. It boasts the largest palm grove in Europe, which gives it a refreshing North African feel, yet its sizeable centre offers all the comforts and activities of a major western European city, including an English school. It's another Costa Blanca city with heaps of historical interest, and the surrounding countryside is stunning.
For this reason - and the fact that the average prices for property in Elche rose by more than 10 per cent last year - it could be a great wildcard for Brits looking for some value-for-money re-sale property, especially if they're in the market for a cortijo (country house) or finca (farmhouse).
Right now, the market for Costa Blanca property is reeling from one body blow after another, and this must result in a continued reluctance among British property buyers to take the property plunge there. It will recover, of course, and whether it's this year, or next, or beyond, the Spanish costas will remain the number one choice for British holidaymakers - and holiday home buyers - for many years to come.
Some information contained within this article may have changed since it was first published. HomesOverseas strongly advises you to seek current legal and financial advise from a qualified professional.