More Spanish resale price falls
From "FOH News" on 10 July 2008
Analysing samples of over 81,000 resale properties across Spain in the first six months of this year, the portal said that prices have fallen at a "faster rate than seen in more recent reports".
According to its research, prices in Madrid city have recorded their largest ever negative variation since Idealista began preparing its report in Q4 2005, while Barcelona has accumulated five consecutive quarterly falls, with prices now sitting at €4,662 per sqm.
"It is likely that prices are falling even more than is reflected by the Idealista.com data, as our analysis is based on asking prices," said
Fernando Encinar, head of Idealista’s surveys team. "Nevertheless, the downward trend in housing prices is confirmed in 2008 and, little by little, price variations are beginning to be mirrored in the discounts being negotiated in end prices.
"However, there is demand. At Idealista.com we are recording all time records in page hits and users, but this demand is only in response to competitive prices. The more aware sellers are that they have to adjust to the change in cycle and accept offers, the more chance they will have of managing to close the deal."
Discounts are rising
Most developers across Spain are starting to realize that to shift stock in this current climate then large discounts will have to be introduced. A new study by consultancy Real Estate Marketing (REM) has revealed that 6 out of 10 Spanish developers are now offering discounts to in an effort to spur sales. When indirect discounts are included 71% of developers are offering buyers improved terms.
According to Spanish Property Insight, which published the report, 41% of the developers surveyed by REM said that discounts of between 10% and 20% deliver the best results. Some developers are also offering a range of other options aside from direct discounts to shift stock. Half of all developers surveyed said that incentives such as better payment terms and mortgage subsidies were being used.
