House prices will continue falling say majority of real estate executives

Hose prices will continue falling in 2011 according to a survey of real estate executives done by CB Richard Ellis for its annual report on the property sector.

Professionals from the sector are as bearish, if not more so, than the general public. 3 out of 4 property company executives expect house prices to continue falling this year, reveals the “2011 Trends” report.

Presenting the report, Edward Farrelly, head of research at CB Richard Ellis, said price falls will vary by zone, with the biggest falls expected in areas with a glut of second homes, for example the Costa Blanca and the Costa del Sol.

On the other hand, prices are forecast to stabilise in city centres, where housing shortages are starting to appear.

Overall, though, 2011 will de another “difficult year” in part due to the housing stock over-hang, which CB Richard Ellis estimate at 700,000 units.

That said, a “mild recovery” in housing starts is on the cards this year, with 40pc of executives forecasting between 100 and 175k housing starts in 2011, up from below 100,000 in 2010.

Farrelly welcomed the recent initiative by the Spanish government to promote holiday-homes abroad, urging all levels of public administration to provide “more clarity” to help lure foreign buyers back to Spain.

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