The Spanish property market
The Spanish property market
After two decades of dizzying growth — and the collapse of a housing bubble — there is a pervasive feeling in Spain that the party is over
Source: New York Times
Property prices in Spain
But what does this mean for the international buyer? If the unsold new homes are shifted into the market uncontrolled, there is a danger that the housing market will suffer additional price reductions. This would leave the banks vulnerable as the mortgages would no longer be covered by the value of the property.
The banks are in no way interested in a collapse of the property market as this would just shift even more properties onto the bank's books.
New homes in Spain
The unsold new homes are not to be compared with the attractive properties along the coastal areas. Many of the unsold new homes are constructed for the sole purpose of maximising the profit of an investor.
Too often these properties are constructed in large buildings of thousands of small apartments in areas with the lowest possible cost of land.
It does not really affect the prices of the good areas in Madrid, Barcelona and the international areas of Costa del Sol.
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