The Spanish property market shrank year-on-year by 40% in February, according to the latest figures from the National Institute of Statistics (INE). Excluding social housing, there were 30,822 property transactions in February, compared to 51,343 a year before.
The second lowest monthly sales results on record, this is a blow after sales figures in December gave optimists hope that the market might be starting to bottom out. The market fell by 41% in January, and February shows that the Spanish property market, measured by sales activity, is still contracting rapidly.
As the table above shows, property sales fell the most in The Balearics, by 54.6%, followed by Asturias (-53%), and Catalonia (-52.3%). None of Spain’s autonomous regions escaped negative figures.
Once again resale transactions were down the most, by 45%, compared to a fall of 29% for newly built properties, giving the impression that the new build market is faring comparatively well. That is misleading. In reality, new sales by developers have collapsed in the last 12 months, but thanks to long lead times in the construction industry, the full impact of this has yet to show up in the INE’s market figures. As the year proceeds, the monthly data for new build sales will fall off rapidly.
With the glut of newly built properties still growing to an estimated 1 million this will put further downward pressure on prices.