Gonzalo Bernardos, a Professor at the University of Barcelona and leading expert on the Spanish property market, explains why Spanish property prices are lower than you might think, and gives 8 tips on how to take advantage of the market.

Participating in an online conference at the Spanish daily El Mundo’s website, Gonzalo said that despite official figures showing Spanish property prices down just 13pc since the peak, prices are actually down “almost as much as the US or Ireland…. it’s [just] not reflected in the official figures ,which are badly assembled using insufficient samples or valuations.”

Arguing that house prices in middle-class districts of the main cities “will not fall anymore,”, Gonzalo warned that in second or third tier locations with big property over-hangs, prices are irrelevant. What matters is how much buyers really want to buy there (La voluntad).

Though he believes 2010 will turn out to be the bottom of the cycle for housing starts, he expects prices to continue falling everywhere but the best locations, especially in coastal areas with lots of holiday-homes, municipalities with small populations, and subprime areas with high stocks.

8 tips for house-hunters

Gonzalo also gave 8 tips for house-hunters in Spain looking to take advantage of the market

1. Show little interest and no signs of being in a hurry.
2. Make out you have at least three alternatives.
3. Aim for a discount of 15pc negotiating with a developer, and 20pc with a private vendor.
4. Have patience.
5. For an investment, go for a holiday-home in one of the best areas, where the best discounts are to be found.
6 Don’t get obsessed with trying to time the bottom of the market: It’s a matter of luck.
7. If you find a place you would love to live in priced around 25 to 30pc below the peak, and you can afford it, then bargain a bit and buy it.
8. If you really want the lowest price then buy from a bank, but be warned you may have to settle for a property in a subprime area with a lot of stock.