Thread: Spanish Property Crash

Experts began to ask each other if the Spanish property market had reached its bottom this month in the light of new figures.


A report from ratings agency S&P showed that Eurozone countries such as Spain, Portugal and Ireland might recover quicker than initially suspected following austerity measures implemented by each government.
With labour costs falling and Spanish exports on the up, S&P predict that companies may begin rehire workers, helping the economy to climb out of recession.

Following this, Fotocasa.es released its new data, revealing that Spanish property prices remained stable in January for the first time in three years. Some places, such as the Canary Islands and Murcia, actually saw prices increase by 0.7 per cent and 1 per cent.


Others urged caution. Huga Navarro, manager at BPA Global Funds in Madrid, told Bloomberg: "It's still a very illiquid market, and there aren't many deals going forward at these prices. The real price, where sales can happen and that would be reflected in official valuations, is still about 20 to 25 percent below these levels."

Ashley Rigg of Global Edge concurs: "It is far too early to call the bottom of the cycle. Fotocasa are reporting asking prices which are far less meaningful than actual sale prices. It is also notoriously difficult to draw conclusions from one month's figures. They may reflect buyers pushing forward purchases to avoid the upcoming VAT rise and u-turn on the tax rebate.
"Perhaps more importantly, we have yet to see the effect of the so-called Spanish "bad bank" releasing properties onto the market. This kind of supply shock could see a sharp drop in prices in certain areas.
"The only true way to tell whether a market has turned is after it's actually happened, as sales begin responding to lower prices and better mortgage conditions. "

My dads been trying to sell his villa in Spain for three years now, they ended up renting it out and moved back to the uk and are renting there. He had to move back for health reasons. I feel so sorry for them as they needed the money to buy in the uk.