Lack of transparency an extra burden for Spanish property market says Wall Street Journal

Posted on November 26, 2010 by
Filed Under Property prices | 4 Comments

The lack of reliable statistics for the Spanish property market unnerves investors and hinders a recovery, explains an article in today’s WSJ.

The lack of transparency in the Spanish property market is one of my favourite bugbears, and I’ve been banging on about this for years. The official figures give the impression that Spain is in denial, and send confusing price signals that scare away potential investors. The lack of transparency is a big obstacle to recovery.

To give you an example of how they muddy the waters, the official statistics like those published by Ministry of Housing have average Spanish property prices down just 13pc from the peak, whereas the reality is more like 20pc to 30pc.

I believe there would be many more foreign buyers around (especially for prime and A-grade homes) if the market was transparent and people knew how much prices have actually dropped. There are some good deals out there if you hunt around, but potential buyers are put off by headlines suggesting otherwise.

Greater transparency would also lift the lid on silly asking prices, which would be most welcome. Deluded vendors are a pest in Spain.

Here is a link to the article at the WSJ online: + A Home-Price Puzzle in Spain

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Comments

4 Responses to “Lack of transparency an extra burden for Spanish property market says Wall Street Journal”

  1. Mark on November 29th, 2010 1:29 pm

    The G-14 group of Spain’s biggest developers have chipped in saying that transparency is not a problem. Great.

  2. Annika B on December 1st, 2010 12:08 pm

    Is it possible to visit the real estate register and there get the information of the latest transactions, property and price?

    Is the register public?

  3. Mark on December 1st, 2010 12:52 pm

    The register is public, but not that easy to access and not much use anyway. Where you do see declared prices, they are often not accurate thanks to the Spanish custom of under-the-table cash payments.

  4. Annika B on December 1st, 2010 1:39 pm

    Thanks for your quick response.

    I thought the under-the-table cash practice was less custom nowadays as the authorities had improved their watch. Maybe not?

    I understand that the prices I can observe att the register is in any case not above the traded price

    Do I have to physically visit the register or can they provide the information at a distance?

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