House Prices Have Fallen by Over 40% in Half of Spain’s Regions
December 10th, 2013
Since the highest house prices in the historical series were recorded in April 2007, at 2,952 euros per square metre, property prices have dropped by an average of 41.3%, according to a recent property price analysis carried out by fotocasa.es. Presently, the price of housing stands at 1,732 euros per square metre, after registering a decline of 0.8% in November.
Up to nine regions have recorded declines of over 40% in house prices since the maximum prices reached six years ago. La Rioja is the region to experience the biggest price drop (-52%), followed by Aragón (-46.5%), Navarra and Castilla-La Mancha (both -46.1%), Murcia (-45.7%), Catalonia (-44.5%), Valencia (-44.1%) and Andalusia and Madrid, which have both fallen by -40.7% in six years.
Beatriz Toribio, head of research for fotocasa.es, said: “The massive housing stock that exists in our country has prompted an adjustment in prices that is not yet finished, but in certain areas it is coming to an end. Although housing prices will continue to fall during 2014, they will be much less pronounced, and we may even see increases in some regions. Everything will depend on how the economy evolves, and especially employment.”
With regard to prices, the Basque Country is still the most expensive region in Spain, with an average price of 3,028 euros per square metre, followed by Madrid (€2,356) and Catalonia (€2,146). In contrast, Castilla-La Mancha (1,194 euros per square metre), Extremadura (€1,202) and Murcia (€1,246) are the regions with the most affordable second hand housing prices.
Of the 376 Spanish municipalities analysed by fotocasa.es, in 69% (259 municipalities) house prices fell in the last month, in 2% (6 municipalities) the prices remained stable, and 29% (111 municipalities) recorded price increases.
The municipality where the price of second hand housing is highest is San Sebastián, with 4,259 euros per square metre, and is the only municipality to exceed 4,000 euros per square metre. Meanwhile, Ontinyent, in Valencia, is the cheapest Spanish town in which to buy a home, with an average price of 848 euros per square metre. Manacor, in Mallorca, is the municipality to experience the biggest increase, of 13.1%, and closed November with a price of 1,472 euros per square metre. At the opposite end, Calpe, in the province of Alicante, is the town which suffered the greatest decline, with a drop of -8.4% in November, to 1,454 euros per square metre.
The fotocasa.es Real Estate Index also analyses the average value of housing in Spain according to its size. The report groups the homes into four different size categories: less than 60 square metres, from 60 to 100 m², from 100 to 150 m², and from 150 to 300 m². With regard to sales prices by size of dwelling, in November, the most significant were the homes of up to 60 m², which ranked as second most expensive at 1,963 euros/m², after those measuring 150 to 300 m² (2,137 euros/m²). In contrast, the most affordable homes were those of between 60 and 100 m² and between 100 and 150 m², with prices of 1,659 euros/m² and 1,744 euros/m², respectively.