Spanish property prices show no sign of ending falls

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Although we reported the other day that the Costa Blanca is holding up when it comes to foreign interest in Spanish property sales, the overall picture across the country is still dominated by the ongoing financial crisis.

New figures show that in the third quarter of 2012 Spanish property prices continued to drop, and although not quite in freefall, the five year long decreases show no signs of turning a corner.

Spain’s statistics agency INE reports the average price of a home in the country falling by 15.2% over the previous twelve month period. Capital city Madrid fared the worst with average prices notching up a decrease of almost 18% year on year.

The historically high unemployment figures, combined with an ongoing squeeze on the availability of credit, is having the effect of there being a glut of unsold properties on the market, ensuring sellers are ever more keen to cut prices in an effort to get things moving.

Elsewhere, the Fund for the Orderly Bank Restructuring has announced its belief that the housing market will recover in 2017, but not before another two years of price drops and a further two years of stagnation.

FROB took over the administration of Banco de Valencia in November last year and has since seen the bank integrate with CaixaBank, so is well placed to make informed predictions.

Expectations are that land prices will drop 12.5% in 2013 and 5% the following year, with a recovery starting in 2016 when prices will start to rise by 3%.

Taking all the data into account it looks as if investment possibilities will be in place for the next couple of years and returns could be seen by holding on to properties for the coming years.

As with all transactions that require funds to be moved internationally, a currency exchange specialist is best placed to give you all the information you need to maximise profit margins on any property purchase deals.

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Spanish property prices show no sign of ending falls

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