Wednesday, 8th July 2020

This Month's Magazine
Now pay for the Price of greed!

Now pay for the Price of greed!

There is always a valid reason when things do not quite work out to plan and the economic step back on the Costa del Sol is no exception. In my opnion that there are several reasons that have contributed to the economic setback.

Yes, it is true that income on the Costa is “imported” from other countries, however I do believe that nowadays this statement
needs qualifying somewhat. “Experts” and newspapers love painting dark, gloomy pictures for the sake of making an impact. They told us that the weakness of the USA economy affected the stock market and therefore the economy globally, now they put the blame on China but the real truth is that the economic crisis persists all over the world. Whatever they want to try and make
you believe, homes are still being repossessed by the score, unemployment figures are still high and poverty is still rife.

I am no financial expert but commonsense dictates that indeed there is a serious crisis in most countries resulting in investors staying put, while property investment in Southern Spain has lost its appeal. However, in my humble opinion, the few will continue to prosper at expense of the many despite what the experts say. This predicament is self inflicted as a result of greed. Take greed out of the equation and conditions will get into the right perspective again.

One can start with excessive taxation that totally deflates any entrepreneurial enthusiasm. What people seem to ask themselves is “what is the point of working or starting business and employing others when all our efforts seem to be taken away by the government and banks?”

What makes it worse is the knowledge that so much of our hard earned money is being devoured by politicians and others in power often to line their own pockets even through bribes, fraud and corruption. It is greed that has resulted in building massive
surplus property stocks; it is greed that has encouraged the enormous borrowing needed to build such stocks; it is the estate agents who have incited investors to speculate “on plans” under the false prospect that sales at a profit before completion would always be possible, thus creating an upside-down pyramid.

It is the army of estate agents, all competing for the same market that created a “gold fever” environment resulting in prices rising in all quarters. Food, rents, and clothes and so on, all increased rapidly and unreasonably, just because everyone wanted a piece of the action.

Having said this, let’s add another two ingredients to the cocktail. Let’s start with the loss of confidence in the Spanish property market as a result of illegal sales we all know about. Then let’s move on to those unimaginative business people, who quite simply copy what others do because it seems to work, regardless of the fact that they have no idea of the trade or profession and even less idea of the market they just moved into.

Too many estate agents, too many publications, marketing companies, furniture shops, web page and graphic designers, kitchen suppliers, interior designers and too many of several others, all trying to make a living from the same activity just because it seems to work, ignoring the market limits, under the wishful impression that they are better than those who know the market inside-out as well as the business.


And the result? It is a small market, not large enough to keep everyone going. So, prices are coming down, rents are coming down, businesses are closing, people give up and move on to greener pastures, yet they can’t even sell up before leaving…

Oh, how wrong you all are! There is no short cut to wealth and deception is short lived. Forget trying to make the “quick buck” and the easy life; stick to what you know, do it properly and, if you need to work for a company, do so conscientiously, earn your
trust as well as your crust.

It is the only way forward. I have lived through the previous recession here on the Costa; it was really bad and for very similar reasons. Sheer hard, honest work was the answer. We have a better chance now with the greater number of available working population, if only taxation was less of a disincentive, banks were made to reduce their excessive greed and there were more effective controls as well as more discouraging punishment for fraudsters and drug trafficking.

We need to encourage the return of foreign residents, the many more there are the greater will be the need for housing, food,
entertainment, education, leisure, clothes and the rest. And… the more money the government will make even with a reduced
level of taxation.

Let’s be positive there is enough to go round to satisfy everyone but let us not be all estate agents, or publishers, or restaurants just because some seem to be making a living from it. Keep an eye on the size of your market, be imaginative, provide your own
ideas create your own market demand.

One successful restaurateur was telling me how angry he is because someone copied his entire menu, restaurant décor and layout duplicating everything 100%. What is the purpose of that?

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