Tinsa, a Spanish property valuation company used by several high street banks, has signalled that house prices will drop a further 20% over 2009. In the same report, they have calculated the drop in 2008 as being 10.1%
If this figure is correct, Tinsa say that this will bring house prices back to their levels in 2005. The monthly drop may be between 1 and 1.4%.
This is not news to many agents down here on the ground, who have seen price reductions of between 20 - 40% in the resale market. The official figures often lag behind the reality of business day to day.
A 10% drop in price does not really attract attention among the bargain hunters looking to purchase a Spanish home at a drastically reduced price. It is only those properties that have reduced to 2005 prices that are actually selling.
It may well take time for certain vendors and developers to catch up with the pricing downturn. It is only those that need to sell for personal or financial reasons that are pricing their properties realistically.
This translates into only a small percentage of properties available at 'distressed' prices. However, they are the only properties that are selling and selling quickly.
01.03.2009