Spain’s property market headed for a fall
Spain’s residential property market is heading for a hard landing, as tightening credit conditions exacerbate problems of oversupply and years of rampant price inflation, figures released Wednesday confirmed.
Completed house sales for January dropped 27 per cent year-on-year, according to the National Statistics Institute (INE), while total lending to home-buyers fell almost 28 per cent to €13.4bn ($21bn, £10.5bn). The value of the average mortgage was down 3 per cent, to €142,794, despite higher financing costs.
Spain’s tourist hotspots have been hardest hit. According to a report by Aguirre Newman, the property consultants, residential estate developments in some parts of the Mediterranean coast now take an average of four years to sell, compared with a few days at the height of the property boom four years ago. About half of the new apartments on the Costa del Sol are sitting unsold, it says.
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