The Spanish daily Provincias reports that property sales to foreigners (not including economic migrants) fell by an average of 50% in the last quarter of 2007, and by as much as 92% in Santa Cruz de Tenerife, all based on figures from the ministry of housing.
Sales to foreigners fell by 75% in Huesca, 75% in Zaragoza, 73% in Asturias, 100% in Avila and Burgos, 91% in Toledo, 72% in Gerona, and 79% in Tarragona. According to this article, foreigners bought 1,766 properties in the last quarter of 2007, down 50% on the previous year.
Purchases by economic migrants living in Spain fell by 41%, undermining the argument that high levels of immigration will keep the market afloat. Economic migrants tend to club together for a mortgage, a practice that nervous banks are starting to refuse.
The article explains that, just like locals, foreign buyers are finding it difficult to get a mortgage in Spain. Some have been turned off by corruption scandals and legal problems, whilst many others are waiting for Spanish property prices to fall. Developers admit that Spain’s image has been seriously damaged by “isolated episodes” of corruption like Marbella, says the article.