Slowdown in price decline brings ‘cautious optimism’

IMPROVEMENT: Property price falls could cease in 2015.

THE rate of price falls for Spanish property slowed to an average 3 per cent in 2014.

This was a big improvement over 2013 when homes lost 9.2 per cent of their value. The figures from the General INIE and Major Markets Indices cover both new and second-hand homes.

It puts prices for housing at around the same level as July 2003 and 41.2 per cent lower than the peak in 2007 just before the housing price bubble burst.

According to property analysts Tinsa, the signs are that the decline in prices could finally stop in 2015 if economic forecasts are met, employment stabilises and more mortgages are granted.

The number of home loans given has been rising over the last few months and the jobless rate is starting to dip, even though it is still at a very high level of more than 23 per cent, but there is cautious optimism starting to creep back into the housing market.

The immediate future for the market looks rosiest on the costas and in major cities, but some areas with a big surplus of unsold housing built in the boom years will still see large price drops. In many cases, it is now possible to buy a home for less than it cost to build.

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