The average price of new housing in Spain’s big cities and provincial capitals fell 7.8pc in 2013, according to the latest report from Sociedad de Tasación, an appraisal company.

The average price per square metre of new homes in Spanish cities fell to 2,039 €/m2 in 2013 (-3pc in the final quarter), which translates into a cost of €183,500 for a home of 90m2.

Outside of the big cities and provincial capitals housing costs 1,583 €/m2, down 6.4pc in 2013. In other cities with more than 100,000 inhabitants prices fell 8pc in 2013, to 1,699 €/m2.

Prices fell the least in towns with less than 25,000 people, down 4.8pc in 2013, according to Sociedad de Tasación.

New house prices fell in all Spain’s autonomous regions in 2013, down the most in Aragon (-11.6pc), Extremadura (-10.2pc), and La Rioja (-10.1pc), and the least in Castile & Leon (-7.5pc), Catalonia (7pc), and the Canaries (-6.5pc).

After the substantial fall in Spanish house prices since the bubble burst, new homes in Spain are now about as expensive as they were, in nominal terms, a decade ago, at the end of 2003.

Sociedad de Tasación forecast that average new house prices in cities will carry on falling in 2014, thanks to the glut and weak demand, as more Spaniards choose renting over buying. They warn that growing foreign demand will not be enough to compensate for weak local demand.

“We expect the adjustment in supply that started at the end of 2008 to continue in 2014 in response to volumes of demand significantly lower than in previous periods, whilst signs of recovery are still uncertain and pending consolidation,” concludes their report.