I am looking at the projects vs markets that I know pretty well and I have serious distrust of the projects and ultimately of the platform. I shall explain why.
For example this project
evoestate.com/project/162/alcobendas-madrid/Right from the start the dates are pure BS. I suggest to read this recent article
elpais.com/ccaa/2019/02/01/madrid/1549035809_400697.htmlIn Alcobendas the municipality can take up to 14 months to approve a new building permit ("licencia de obra nueva") which is exactly what this project needs. What do they put in the project?
The planned deadlines for the promotion are as follows:
May 2019 private contract with the seller.
September 2019 public deed.
December 2019, obtaining the works license.3 months for a new building permit next to Madrid? Are they out of their ... mind? This is so reckless to put in a project plan that it smells of BS from far away. Only in small municipalities far from big cities, this is possible in Spain. Spanish planning authorities are known for being very slow!!! The article I linked, just shows a few figures (use google translate if you do not understand Spanish). If the promoter is so reckless to put such improbable plan, then I start to doubt all the rest very much. The project looks very good for the promoter (who is making sure money) and very bad for the investors!
Then I look at another project:
evoestate.com/project/163/riconversione-urbana/The place is in the middle of nowhere and building houses in Italy outside major cities has been a loss making operation in the past 10 years (and it is worsening since Italy has zero to negative growth and a big glut of properties)
Buyer has given a small upfront deposit of 70k for land worth 4.8M!!! And then they say highest risk with this project is: "that if the buyer breaks his contract and doesn't buy the land, it could be hard liquidate the property, as the land is located in Scanzano Jonico, which is a small town in Southern Italy". The liquidation value of these properties will be way less the construction and loan value!!! Again the economics of the project do not make any sense.
Another massive high risk, no collateral project (the builder has no shame in asking money for the actual project and provides no collateral):
evoestate.com/project/153/emporda-in-phase-1/As a minimum the building company should put their own money for the project and the land for a project in the middle of literally nowhere (a small pueblo close to Girona).
I rest my case.
