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Spanish Price Falls Decrease To 1.6% Year-On-Year

 June 25, 2014  /  Comments Off on Spanish Price Falls Decrease To 1.6% Year-On-Year

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The decline in Spanish property price values has fallen to its slowest rate in three years. Experts believe that this is another sign that the market is beginning to turn the corner and move away from the property recession which has been such a problem since 2008.

Values in the Spanish property market have fallen just 1.6 per cent year-on-year – the slowest rate for over three years.

Values have actually risen in some areas, including Madrid, which is up 1.9 per cent, Basque Country is up 1.4 per cent and Baleares up 0.2 per cent, according to first quarter 2014 figures released by INE, Spain’s national statistics institute.

The biggest price drops came in Navarra, Extremadura, Castilla-La Mancha, Castilla y León and Asturias, with decreases of 8.6, 7.5, 6, 5.6 and 5 per cent respectively.

Spanish Price Falls

Mercers estate agents founder, Chris Mercer, said in an interview with OPP connect, that “The upturn in Sales over the past 15 months is starting to have an effect on house prices. Whilst official Spanish national statistics quote a fall in property values of around 36 per cent from the highs of 2007, we have seen prices fall as much as 50 per cent. So this combined with a stronger Sterling (7 per cent more Euros per £1) is once again fuelling demand, which, in turn, is holding prices steady.

I don’t think it will be long before we start to see prices starting to show signs of a positive upturn.”

Prices have fallen 0.3 per cent from the previous quarter, with values of new homes falling 1.1 per cent and resales dropping by 1.7 per cent annually, as shown by data from the Spanish Housing Price Index (HPI).

What Does This Mean?

These are figures are comparatively much better than those of the last quarter of 2013, where prices fell a massive 7.8 per cent year-on-year. Since the housing bubble burst in 2008 and Spain was hit by the global economic crisis, property prices have dropped a total of 36 per cent.

The Spanish government believes that the country’s GDP will grow up to 1.2 per cent this year, and 1.8 per cent in 2015.

OPP Connect reports that out of approximately 1,000 people surveyed on behalf of Swedish agency Fastighetsbyrån, 34 per cent say that they want a holiday home in Spain, with Italy following from afar at 12 per cent, and France next at 11 per cent.

Most of those who have bought a foreign property come from Stockholm and they have been dreaming of a holiday home for seven years, on average, with only 5 per cent believing that they will make a purchase within the next two years.

Expert Opinion

Ron Wilkinson of Alta Vista thinks that slowing of price falls is a further indication that a reversal in fortunes is just around the corner.

“I confidently believe that a nationwide price rise will be witnessed by the end of 2014. All the signs are pointing to a turnaround in the market, there has been increase in interest, increase in sale, and most importantly an increase in prices in some areas.

“If we can maintain the current level of interest from abroad, then there should be absolutely nothing stopping the property market from performing exceedingly well in the future, right now we are at a point where even the slightest gains are a sign that things are about to come good.”

Bradley Shore is an experienced travel and investment blogger, he likes to write his articles relevant to the latest news in his areas, his influences are to build the knowledge of his readers about property investment in Uk and overseas.

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  • Published: 3 years ago on June 25, 2014
  • Last Modified: May 19, 2016 @ 8:01 am
  • Filed Under: Home Improvement

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