Whilst august institutions like the IMF, the OECD, The Economist Magazine, and even the Bank of Spain have been warning for years that Spanish property prices are inflated, and might fall, the one group that has consistently refused to entertain such a possibility has been Spain’s property developers. But finally, in the face of mounting evidence of a Spanish property crash, and with big, quoted developers like Martinsa-Fadesa fighting for their survival, some developers are starting to break ranks and concede that property prices will fall.
Cue Mariano Miguel, ex-president and present board member of the quoted developer Colonial, which is also struggling to stay afloat in a sea of debt. Speaking at a recent conference organised by the Spanish savings bank Caja Madrid, Miguel said that he expects property prices to fall in real terms (after inflation) by between 25% and 30% over the next 2 to 3 years.
“We have to put on our helmets because hard times are coming,” said Miguel, who sees “no escape” for the real estate sector in the short term.
On a more positive note, Miguel said that the demand-lead collapse in the market will “pass quickly’, and that “the only thing they [companies in the real estate sector] can do is let time pass.”
Colonial belongs to the G-14 lobby group representing the 14 biggest developers in Spain. The G-14 is sticking to its position that property prices in Spain will never faaaaaal