Optimistic signs for Spanish property

Property prices in Spain are dropping, tax on new build property is down by 50%, sales numbers are climbing and tourism numbers are at record levels – could this be the end of Spain’s holiday homes slump? For the first time international investors have overtaken domestic buyers.

Property agents all over Spain have noticed an increase in inquiries, viewing trips and sales as buyers watch prices fall.

TINSA’s August House Price Report noted an accumulated drop of 23.5% since it’s peak in late 2007. In the more popular areas excessive supply has pushed prices down by around 30%, while some repossessed properties have been selling at up to half the book value, with those in the best locations selling out first.

Overseas buyers are currently buying up to 1,000 properties a day in key areas like the Costa Blanca, Costa del Sol and Ibiza. Up to half of these sales are from Spanish banks or cash-strapped developers.