Year-end data from the Government confirms that 2010 was the worst year on record for the Spanish home-building industry. The chart above illustrates just how much of a pummelling the industry has taken in the last four years.
There were just 91,662 planning approvals in 2010, down 17pc on 2009, and 89pc on the record 865,561 in 2006.
-89pc in 4 years: This figures is dramatic. It tells a story of an industry that has all but collapsed. And not just any industry; residential construction was responsible for much of Spain’s growth in employment and GDP over the last decade.
The only good news, if you can call it that, is that the collapse is bottoming out.
The following chart from idealista.com takes a longer-term view and shows how planning approvals have fallen to the lowest level on record. Things weren’t even this bad in the depths of the last recession in 1992.
As I said on this subject last month, my feeling is that we are the beginning of the end of this crisis. Repeating my conclusion last month, I forecast that 2010 will mark the bottom of this cycle for Spain’s residential construction industry. New home construction will start growing again in 2011, albeit weakly and from an exceptionally low base. That’s my forecast, but I could easily be wrong.
In the meantime I know of architects that are having to baby-sit for a living.
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