Measured by transactions, the Spanish property market shrank 34% in the first 3 months of this year, according to the Ministry of Housing. There were just 104,703 residential property sales between January and March this year, compared to 159,088 in the same period last year. A pitiful number of just 484 holiday homes were sold to non-residents.

Sales have been declining fairly steadily since the beginning of 2007, and the latest figures show there is no sign yet of the market bottoming out.

The Ministry of Housing broke the news by comparing last quarter’s sales to the previous quarter, which makes the news sound less grim. Compared to the last quarter of 2008, the latest sales are a drop of ‘only’ 16.5%.

The Ministry of Housing also points out that, over the 12 months to the end of March, there were 510,079 transactions, a drop of 33.3% compared to the previous 12 months.

As is clear from the table below, home sales in the latest quarter were the lowest since the Ministry of Housing started compiling this data. Compared to the 1st quarter of 2006, when 233,669 residential properties changed hands, sales in the latest quarter were down a thumping 55%.

Breaking down the figures into new build and resales, there were 58,993 newly built properties sold in the quarter, compared to 45,710 resales. Once again, new builds sold in greater numbers than resales, as they have done every quarter since the 2nd quarter of 2007. Prior to that, resales had always been in the majority.

Spain’s out of control building boom in the middle of the decade explains why new build sales started to outnumber resales. Now the boom is well and truly over we can expect sales of new builds to fall below resales, restoring the natural order. Quarter to quarter, new build sales fell 21.3% in the first quarter, compared to 9.4% for resales. This trend will continue, and by the end of the year new build sales will be significantly below resales.

Regional results

38% of all sales took place in just 6 provinces: Madrid, Barcelona, Alicante, Valencia, Málaga and Murcia.

Over 12 months to the end of March sales fell by the following percentages in the autonomous regions:

Balearics, -43,6%; Catalonia, -42,2%; Canaries, -39,0%; Valencian Community, -37,5%; Castilla y León, -35,4%, Andalucía, -33,7%. Castilla-La Mancha, -32,3%; Asturias, -31,3%; Cantabria, -29,4%; Aragón, -29,2%; Madrid, -28,5%; Galicia -27,5%; Murcia, -27,4%; La Rioja, -26,1%; Basque Country, -21,8%; Extremadura, -13,9%, and Navarra, -8,0%.