Property prices fell 4% in 2011

In 2011 the price of new properties in Spain fell by 4% bringing the average price down to 2,376 euros per square metre, and the cost of the average home to around 213,000 euros.

This is according to the Sociedad de Tasación (Valuation Society) who estimate that prices will continue to fall in 2012 after falling 3.2% in 2010 and 4% in 2011.

Although they predict further decreases they stress that in some locations the decrease may be less pronounced. “It is expected the adjustment will continue at the supply level offered in late 2008, adapted to meet a volume of demand lower than in previous periods,” they said.

Europa Press reported that during 2011, the average price of new housing fell in 48 of the 50 provincial capitals, while only one saw an increase and the other remained unchanged.

Of the capitals Sevilla saw the greatest decline at -8.3% followed closely by Ciudad Real at -7.8%.

Four provincial capitals (Barcelona, San Sebastian, Madrid and Bilbao), saw a price per square metre higher than the national average while in ten others  (Murcia, Cáceres, Badajoz, Pontevedra, Jaén, Lugo, Zamora, Tenerife, Avila and Ciudad Real) the average value fell below 1,500 euros.

There were 81,000 new builds registered in 2011 showing a decline in construction mainly due to difficulties in financing projects.

The Sociedad de Tasación also noted an increase in the number of properties between one and five years old that were vacant and still awaiting first occupation, being offered for sale by non-real estate professionals including credit institutions and private individuals.

There was also an increase in the number of properties being sold on a rent-to-buy option.

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