More Problems for the Costa del Sol Property Market

September 26, 2006

Marbella has taken another blow with the arrest of its mayor and other officials in a multi-million euro corruption scandal.

The latest case unfolded with a huge police raid on city hall and other municipal agencies, designed to break up a massive and elaborate local government network engaged in embezzling EUR 2.4 billion in public funds.

Uncontrolled housing construction has resulted in more than 20,000 homes being built illegally on the Costa del Sol, which are now awaiting a court order to be demolished.

More than 1,000 bank accounts have been frozen and 21 people have been arrested, including Mayor Marisol Yague and city planner, Juan Antonio Roca, who is known to be one of the Costa del Sol's richest men.

The emerging scale of the corruption has sent the Costa del Sol housing market into freefall, with analysts describing the market as "offering no investment opportunities whatsoever".

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