Rental values have been hammered by Spain’s economic crisis, with implications for house prices.

Average rental prices fell 0.5pc in January, according to data from Fotocasa, a property portal, the latest monthly decline in a downward trend that started in May 2007. Peak-to-present, rental prices have fallen 32pc to an average of 6.87 €/m2 in January. However, declines are getting smaller in line with the deceleration in house price declines.

Rental price have fallen more than 30pc in nine regions, lead by Aragon (-43pc), then Cantabria (-38pc), the Valencian Community (-37pc), Castilla-La Mancha, Catalonia and Murcia (-33pc), La Rioja (-31pc), Andalusia and the Balearics (-30pc).

After the housing bubble burst, the subsequent economic crisis pushed down both house prices and rents, but rental prices have held up better, down 32pc, compared to a 41pc decline in house prices, all according to Fotocasa’s data. “[Rental] prices will carry on falling gently this year, and we will start to see increases in some districts of big cities,” explains Beatriz Toribio, head of research at Fotocasa.

In annualised terms, rental prices fell 5.2pc over 12 months to the end of January, falling the most in Cantabria, Catalonia and Madrid, but rising in Murcia and La Rioja. Rents are most expensive in the Basque Country (9.46 €/m2/month), Madrid (9 €/m2/month), and Catalonia (8.29 €/m2/month), and cheapest in Extremadura (4.49 €/m2/month).