Stats about Spanish property prices never stop coming from one source or another. All of them are predictions but all of them agree that prices have dropped… and there is still room to drop even further on average. In 2011 the average property prices fall in Spain was 11.3%.
Spain, according to the data that the magazine “The Economist” handles, is the first world country where housing prices have fallen the most, in front of Holland (-6.8%), Ireland (-5.7%), Italy (-4%) and Japan (-2%), completing a fall of 24% since the end of 2007, the trimester when the international financial crisis broke out. According to the appraiser Tinsa, houses in 2012 lost a value of 11.3%, more than any other year, and since 2007 they have already fallen 33.2%.
The British weekly publication affirms that Spain is “in another league” far from France, for example, where symptoms of the housing crisis have also been noted along with an increase of the unemployment rate of up to 10%.
It’s not the first time that the magazine has predicted a drop into the abyss of the housing business. In August 2012, it stated that prices would fall bit by bit until reaching a “just price,” that is, considering available profit and rentals. Prices of flats went up 190% in Spain between 1997 and the third trimester of 2007, according to the publication.
‘The Economist’ continues following the Spanish housing market closely. Two years ago, it assured us that flats would be worth 50% more, and at the start of 2010 they assured us that that was an overvaluation of 55%.
The United States recuperates
While different European countries are seeing that their properties are losing value year after year, the United States, the country that sparked the financial crisis, has already done its chores and is seeing that prices are starting to rise again (4.3% in 2012), in part “due to the sharp correction of the prices that, in a few years, had situated themselves at one of the lowest levels in history.” Since 2007, houses saw a drop of 20%, only behind Spain and Ireland (-49%).
This information indicates that, opposed to the tendency that is perceived in Spain, other parts of the world are experiencing significant increases in prices in the housing sector. Such is the case in Hong Kong, where homes became more expensive by 21.8% in 2012, or in South Africa, where the increase was 5%.
Other articles of interest:
Dealing with distressed sellers in Spain
Should I pay a Finder Fee to source a property in Spain?