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July 15, 2014

Reducing the cost of property in Spain in the second quarter of 2014

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Reducing the cost of property in Spain in the second quarter of 2014

The property prices in Spain continue to fall, but to a lesser extent: only 2.3% at the end of the second quarter of 2014, according to official data from the National Evaluation Agency. These figures are far from 15%, which decreased the value of property in Spain a year ago. At the same time, a new property for the first six months of 2014 became cheaper by 1.8%. The greatest decline in property prices has occurred in Spanish provinces such as Cantabria and Valencia.

Average cost of housing in Spain continues to fall, but less and less. At least these data present some companies from real estate market in Spain, such as the Evaluation Agency which claims that average house prices slowed its decline to 2.3% at the end of the second quarter of 2014, compared with a year earlier. Such data contrasts sharply with the 15% decline recorded at the end of June 2013.

As for the last three months, the combined average price of new and second homes increased by 4.5% and amounted to 1,328 euros per m2 compared to 1,270 euros per m2 in the previous quarter.

The combined average price of property in Spain fell by 44.7% from the peak, which was reached in 2007, when the price per 1 m2 was 2,401 euros. In general, according to the Evaluation Agency, we cannot yet talk about a significant improvement in the level of demand for real estate, although it is worth noting that the prospects to be far better than they were during these six months. Thus, we can understand that while it is impossible to guarantee that the value of real estate in Spain reached the lower limit in terms of price.

The Evaluation Agency also indicates that you have to wait to see if this trend in real estate prices in Spain to decline continues, and the real estate market recovers.

If we consider only new housing, its value decreased by 4.8% in one year and by 1.8% in the first six months of 2014, representing the cumulative drop of 40% of the maximum registered in 2008.

By regions of Spain, Cantabria and Valencia showed the biggest decline in average house prices, with a decline of 10.6% and 9.8%, respectively. Followed by Galicia (-6.6%), Canary Islands (-6.5%) and Castilla y Leon (-5.7%). Less pronounced fall in prices were recorded in Asturias (-1%) and Castilla-La Mancha (-1.2%), while in Aragon the prices remained unchanged in 1,097 euros per square meter.

 

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