Foreigners might be buying more holiday-homes in Spain (see previous article) but it’s not enough to compensate for the collapse in Spanish demand for primary housing.
There were just 22,072 Spanish home sales in March (excluding social housing), 21pc less than a year ago and 28pc down in a month, according to the latest figures from the National Statistics Institute (INE).
2012 is turning out to be the worst year yet since Spain’s real estate bubble burst back in 2007, as illustrated by the chart above. Year to date the market is down 28pc on the same period last year.
The housing market in March was almost 70pc smaller than March 2007, when the boom was just starting to cool. Add in a price fall of, say, 30pc, and the market is down almost 80pc by value.
Unemployment heading for 25pc and a credit crunch in the Spanish banking sector help explain these remarkably awful figures.
The following table gives monthly house sales figures (excluding social housing) for the last 6 years. Click to enlarge.