Spanish Property market is still unsteady

By HopwoodHouse, 17 July, 2015

The recent data, released on prices in the Spanish property marker has shown that the recovery is still on-going as the slowdown is still clinging on, whilst the official figures and the figures from real estate firms still differ.

Valuations company Tinsa, has released figures that show that the price of property on a national level is still decreasing but there are some regions that are experiencing an increase, but figures from the Housing Department shows that there is a slight drop in prices.

For May of this year, the valuations from Tinsa show that there was an average drop of 3.6% year on year for national house prices but this figure does hide the variations between the different regions.

The largest price falls were seen in the provincial capitals as well as the big cities where a decline of 4.9% was steep, although houses on the coast dropped by 2.3% along with a 2.1% drop in prices in the Canaries and Balearics.

Regardless of this, there is a year on year increase along the coast of 1.4% when compared to May 2014 but they are still down by 48.8% when compared to the peak of the market and Tinsa believe that the national average peak to present fall is 42.1%.

Government figures show that the average cost of a property for sale in Spain dropped by 0.11% for the first three months of 2015 and this is the smallest drop in a quarter since the financial crisis took hold and it is down from a drop of 0.36% during the last quarter of 2014.

This has resulted in the average price per square metre being €1,458 which is also down by 36.3%, a figure which has been adjusted for inflation since the market peaked in 2008 when the price was €2,100 per square metre.

When the regional figures are broken down it shows that seven regions had experienced a year on year price increase with the Canaries at the top with 3.56%, Aragon with 1.9%, Madrid with 1.67%, the Valencian Community saw an increase of 0.69%, Extremadura increased by 0.57%, the Balearics rose by 0.1% and Andalusia increased by 0.05%.

However, all other areas of Spain are experiencing price decreases annually. There has been a year on year decrease of 6.53% in Asturias, 3.73% in Castille-Leon, Navarra experienced a 3.15% drop, Galicia decreased by 2.29% and there was a drop of 1.47% in the Basque Country.

The National Statistics Institute has published the Housing Price Index which shows that the cost of homes increased by 1.5% during the first quarter of this year when compared to the first quarter of 2014 which is lower than the 1.8% increased that was recorded at the end of 2014.

Following six years of decline, the index recorded year on year increases over four consecutive quarters, it is also showing that prices for new homes are increasing quicker than others. Second hand homes rose by 1.1% during the first quarter of this year and the price of new homes increased by 4%.

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