It’s still not clear where the Spanish housing market is headed

Pedro Pérez – President of the G-14 – claims house prices have risen 20pc (from the bottom, I assume) in some areas of Madrid, Extremadura, Galicia and other parts of North Spain due to supply shortages. He warns that another bubble could be in the making, but I wouldn’t lose any sleep over it.

Alberto Quemada – Director of the developer Quabit – claims that the opportunity to bag a bargain in Spain has already past. “We have already sold the best homes at the best prices,” he said, quoted in the press.

Beatriz Corredor – Secretary of State for Housing – says the glut of 700,000 new homes will have gone by 2014. “There is a high stock of property, with a lot of holiday-homes available, co-existing with shortages for primary residencies,” she said, while on the road-show in Germany to promote holiday-homes in Spain. She was there to convince Germans it’s a great time to invest in a holiday-home in Spain.

Her boss José Blanco – Minister of Public Works – says that the housing bust is in its final phase and that “the greater part of the house price adjustment has already past….There are areas where further falls are not expected.” Even so, he warns that “difficult and demanding” times lie ahead for the sector.

According to José Luis Malo de Molina – head of research at the Bank of Spain – speaking at a conference at the SIMA property exhibition in Madrid, Spanish house prices have fallen 20pc since Q1 2008 and will bottom out down 30pc in real terms (inflation adjusted) at the end of 2012. “It’s a price adjustment in real terms bigger than in past real estate crises,” he said.

Malo de Molina either doesn’t know, or prefers not to say, but real prices are already down more than 30pc. He also admitted that official statistics are not up to the job.

His assertion that prices will go down another 10pc has caused an uproar amongst developers.

Banks should reduce their asking prices another 15pc this year argues the economist Francisco J. Sánchez Vellvé, “especially considering their assets aren’t the best in the market.”