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According to Rodriguez de Acuna, the over-supply in the market will take 6 years to absorb. And meanwhile house prices will likely fall even further — up to 40 percent from their peak, according to RBS.
The British bank said the slide in house prices could even accelerate given the mortgage lenders also need to offload the property portfolios they accumulated during the boom — and, unwillingly, in the crash.
Indeed, many banks have already started the process of shedding their properties, offering discounts of up to 50 percent on the original valuation.
And some warn that housing prices will not recover until the banks’ books — especially the weaker savings banks, heavily dependent on crisis funding from the European Central Bank — are cleaned up.
“The moment the ECB’s liquidity window closes, the cajas will have to sell at whatever price because they will need the money, and then we will truly see house prices fall,” said Quemada.
So the price crash has not even begun.
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This article is in accord with many opinions expressed on this forum including my own especially this:
“The moment the ECB’s liquidity window closes, the cajas will have to sell at whatever price because they will need the money, and then we will truly see house prices fall,” said Quemada.
As I read postings on other threads I realise that some posters do not have much basic knowledge of how market economics work therefore their opinions are a bit skewed.
If a few properties get sold or agents/sellers have a few enquiries they think the market is turning or the bottom has been reached.
They and anyone considering buying a property need to study more closely the economic fundamentals which effect the Spanish market and this article is a good start.
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