Spanish house prices rose 1.8 per cent in 2014, the first annual increase since 2007, according to the Official House Price Index published by the National Institute of Statistics (INE).
The rate of increase in Spanish house prices accelerate slightly as the year progressed, if the figures are to be believed. 2014 started with a decrease of 1.6 per cent in the first quarter, but ended the year up 1.8 per cent.
By autonomous regions, year-on-year prices went down in three regions: Navarra (-4.2 per cent), Extremadura (-0.7 per cent) and Asturias (-0.3 per cent), and increased the most in Madrid (+2.9 per cent), the Valencian Community (+2.8 per cent), Murcia (+2.7 per cent) and Catalonia (+2.2 per cent).
Analysis by Mark Stücklin
How can Spanish house prices be anywhere close to rising with such a big glut of never-previously-sold homes on the market – still estimated at around 600,000 units – a falling population, grinding internal devaluation, unemployment close to 25%, and a continuing mortgage drought?
One reason is the statistics aren’t very reliable, and though they probably give us an idea of the trend, an increase of 1.8 per cent could just as easily be a decrease of 2 per cent. Let’s say it’s well within the margin of error.
Another factor might be the lack of demand for much of the glut, which means it has a limited impact on prices. If nobody is buying any of the homes built in the wrong place, they don’t have much impact on transaction prices. That said, the glut is bound to have a depressing influence on asking prices in some segments, but less so in popular areas where most sales take place today.
And as the latest monthly house price index for February from the appraisal company Tinsa show, with an annualised decline of 3.6 per cent, it’s too early to assume the crisis is over, as it all depends on which figures you look at.