A year ago housing market forecasts for 2013 were generally pessimistic, but this year the mood is more positive, with some commentators forecasting the bottom of the market in 2014.
Signs of optimism aside, there will be plenty of bad news to come in 2014, as you can see from these five forecasts for key metrics in the Spanish housing market during 2014.
Lower house prices
Spanish house prices will continue falling through to 2015 forecasts the ratings agency Standard & Poors, down 5pc in 2014, and 1pc in 2015, largely thanks to the oversupply putting vendors in a weak position.
Fotocasa, a property portal, forecast asking prices down by another 8pc to 9pc this year, and rental prices down 5pc.
Lower mortgage base rates
With Eurozone base rates now at a record low of 0.25pc, experts forecast that Euribor will follow suit and plumb new depths in the coming months.
Ending last year on 0.543pc, some forecast Euribor will go as low as 0.25pc, though the consensus is more like 0.30pc.
Bigger bad debts
The percentage of personal mortgages in default recently surged to 5.4pc according to data from the Bank of Spain, and experts forecast it will rise above 6pc this year, as families finally run out of savings, and banks fess up to non-performing loans.
According to one support group, 150,000 families have lost their homes since the start of the crisis, 65pc of them due to unemployment. The number of families evicted with debts could rise to half a million by the end of 2015.
Mortgage lending bottoms out
Though mortgage lending is still plunging, Luis María Linde, Governor of the Bank of Spain, sees signs of “a certain amount of optimism” and reasons to believe the bottom is close. Banks like Santander, Bankia, and Sabadell all say they expect to lend more in 2014, though any recovery in lending will be gradual at best.
Home sales start to rise
Sales volumes will increase by a modest amount in 2014 forecasts José García Montalvo, a professor and real estate expert at the Pompeu Fabra University. “There will not be many more homes sold, but there will be some more sold, because we have reached the bottom,” he says, quoted in the financial press.
“In coastal provinces there will be an increase in sales, because foreigners will carry on buying more, but I don’t think there will be an increase at a national level, at best it will stabilise,” forecasts real estate consultant José Luis Ruiz Bartolomé.