This is a website for buyers, owners, and sellers of property in Spain, offering reliable information and resources to help you get things done with confidence. It is run by Mark Stücklin, author of the Spanish Property Doctor Column in The Sunday Times (2005-2008), and the book ‘Need to Know: Buying Property in Spain’ published by Collins.
Of all the countries in the EU, house prices fell the most in Spain last year, placing the country in a league of its own for double-digit price declines. Seasoned investors will know now is the time to look seriously at Spain.
Spanish house prices fell 12.8pc last year according to Government figures (see Official Spanish House Price Index falls 12.8pc in 2012). The EU House Price Index, just published by Eurostat – the statistical office of the EU – reveals that Spain was the EU country where house prices fell the most last year, by a long stretch.
House prices, as measured by the EU’s House Price Index (HPI), fell by 1.8pc in the Euro area
and by 1.4pc in the EU in the fourth quarter of 2012 compared with the same quarter of the previous year.
Among the Member States for which data are available, the highest annual increases in house prices in the fourth quarter of 2012 were recorded in Latvia (+9.8%), Estonia (+5.8%) and Malta (+5.4%), and the largest falls in Spain (-12.8%), Romania (-9.1%), and Slovenia (-8.8%).
No figures are available for Greece and Cyprus, where house prices are also likely to have fallen substantially, and might have given Spain some company in the negative double-digits.
It’s interesting to compare price changes in Ireland and Spain: Annualised property price declines in Ireland shrank from 16.3pc in Q1 to just 4.5pc in Q4, whilst Spanish declines ended the year almost exactly where they started.
I assume that Ireland is nearing the end of it property price adjustment process, whilst Spain is still at the nadir.
A time of opportunity
My interpretation is that, after 4 years of denial and unrealistic price expectations, enough vendors in Spain are finally coming to terms with reality. House price declines have been accelerating in the last couple of years, and Spanish house prices are starting to offer good value. There are great bargains to be had.
Prime Spanish property, in particular, might now a good investment for those prepared to do the homework to identify the opportunities.
In a world awash with central bank liquidity, menacing inflation, low interest rates, and risible returns on savings, ever cheaper Spanish real estate is starting to attract the interest of increasing numbers of international investors.
Steve A says:
The trend is still down, but slowing a little. Best guess is that prices will still fall between 10% and 20% more before hitting bottom. Say a true peak to trough fall of at least 45%, and perhaps as high as 55%. Amazingly many ads are still asking crazy prices, many for amounts even higher than genuine peak prices in 2007/8. No doubt a bloke in the pub once told these poor deluded vendors that their property was ‘worth’ squillions and they believed him: a major problem is that many sellers think peak prices were far higher than they really ever were.
Mark Stucklin says:
Forget asking prices. Sales prices in quality residential areas are down 60pc or more. That is the reality.
Cedric says:
Are the Apt prices in Tenerife still falling at similar levels to that of mainland Spain?