House Prices Fell by 11.3% in 2012

The average price of housing in Spain reduced by 11.3% in 2012 over the previous year, a more moderate adjustment than that experienced in previous months, due to a spike in the number of transactions generated to beat the 31st December deadline for the end of tax deductions and the rise in VAT for new housing.

According to the Spanish Real Estate Market Index (IMIE) for the last month of 2012, released on Tuesday by the appraiser Tinsa, Spanish properties have become cheaper by 33.3% since reaching their highest prices in December 2007.

By area, houses in the capitals and large cities were those which recorded the largest reductions in their prices in December (-14%), followed by those located in metropolitan areas (-13.7%) and on the Mediterranean coast (-12.5%).

Below the average were homes in the Balearic and Canary Islands (-6.6%) and those in other smaller municipalities (-7.7%).

Regarding accumulated decreases, Diario Sur reported that since their highest values reached, the prices of the houses on the Mediterranean coast have become cheaper by 40.1% and in the capitals and major cities by 36.7%. Also, prices have accumulated declines since their highs in the metropolitan areas of 35.4%, in the Balearic and Canary Islands by 27.3%, and the remaining municipalities by 27.6%.