A summary of all the latest property price indices and house-price forecasts released in the last week. They all agree that prices are still falling and will continue to fall.
Idealista asking price index in April: -7.3pc over 12 months, -0.8pc over one month. This index shows vendors dropping their asking prices at an increasing rate, as illustrated in the following graph.
Tinsa house price index April: -4.4pc over 12 months, -6.4pc on the Mediterranean Coast.
How prices have evolved peak-to-present:
And the index over 12 months, by area:
Standard & Poor’s, a ratings agency: Prices to continue falling over the next 12-18 months but not dramatically. Transactions expected to continue their modest recuperation. They say it will take “several more years to completely absorb the excess supply.” Replace “several” with “many” and they aren’t far wrong.
BBVA, a Spanish bank: Price falls of 10pc on average in 2011, on top of falls of up to 50pc already accumulated on the coast. BBVA say holiday-homes on the coast fell 20pc in value last year.
The Valencian Institute of Economic Research (IVIE): Price falls of 12pc on average in 2011, on top of a fall of 20pc accumulated since 2008. Spain’s chunky glut of homes and rising interest rates will keep prices going down for the time being, argue this Valencian outfit.
Illustrating IVIE’s point about prices falling more in real terms, the following charts shows the ups and downs of prices since 1985, in both nominal and real (inflation adjusted) terms. After inflation, prices are back to where they were in 2003 / 2004, but they still have further to fall.