Spanish House Sales Slump

Official figures from Spain's National Statistics Institute have revealed that the Spanish property sector is in a dramatic decline. Sales of houses decreased 26.3% in the year to July, with mortgage lending also decreasing by 33.2%.

Spanish house prices declined by 0.3% between April and June 2008, according to the Spanish housing ministry. However, the market believes there has been a 5% decline since the start of the year, and that property is currently 30% overvalued. The downward price trend comes after an economic boom fuelled by property lasting over ten years, leading to fears that Spain could follow Ireland, becoming another nation officially in recession.


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