Of course Spain caught up when they entered Europe.
I don´t think entering the Euro, or becoming a member state caused the property price hike Katy. France, Italy and other European markets never suffered such inflationary rises as Spain has.
I´m certain it was the lack of regulation in the industry compared to say France, that allowed someone to sell their Taxi in Ealing on Saturday and open an Estate Agency in Estepona on Monday.
The lack of professional skills, such as, valuation, market controls and fiscal planning lead to self destruction through spiraling house prices.
When some of those agent grew large and fat, they felt invincible. But when a 3 bed detached in Alicante became same price as its counterpart in Leicester through abismal valuation decisions the agents killed the goose for themselves.
Had house price inflation been contro led better, we would be looking at a drop in the market similar to what is expected in the UK. However, it was not, and therefore we can expect much worse.
ralita often criticises the poor quality of Spanish new build apartments and is quite right to do so. I touched on the reasons in my previous post, and cite the low UK budgets for this. The developers have to build cheap apartments for the cheap UK low-budget market. Spanish buyers seem quite happy at the quality, they have far worse from the Franco era to measure them by.