Secondhand home prices fall 7.5 percent in 1 year

The price of secondhand homes in Spain slipped 7.5 percent in the year to July, a slight improvement on the 10 percent fall clocked up in the previous 12 months, a study released on Wednesday shows.

Secondhand home prices fall 7.5 percent in 1 year
Secondhand homes in Spain have fallen 44 percent in price since their April 2007 peak. Photo of Spanish villas: Shutterstock

The report from online property portal Fotocasa shows the average price of Spain's secondhand, or non-new homes was €1,641 ($2,193) per square metre in July 2014.

That's 0.9 percent down on June figures, and 7.5 percent below July 2013 figures, the report reveals.

It is also 44 percent down on the April 2007 peak of €2,952 per square metre, achieved before Spain's property bubble burst.

The biggest July drops were in Navarre, down 2.2 percent, Castilla–La Mancha (2.1 percent) and the Canary Islands, where the prices of non-new homes slipped 1.1 percent.

At the other end of the scale prices for these properties climbed 1.9 percent in Galicia, 1.5 percent in Catalonia and 0.8 percent in the Basque Country.

The Basque Country also remains the most expensive region in Spain to buy non-new homes by a long shot, with prices at €2,951 per square metre.

SEE ALSO: The Local's guide to Spain's most expensive streets.

Next cab off the rank is Madrid where a square metre costs €2,194, while the third most expensive region for secondhand homes is Catalonia at €2,017 per square metre.

The most expensive municipality is Zarautz in the Basque province of Guipúzcoa, where non-new properties are priced at €4,804. 

House prices in Spain will climb 2 percent in 2016 after hitting rock bottom in 2015, the ratings agency Standard & Poors said in a recent report.

Properties in Spain have fallen around 30 percent since the country's economic crisis hit in 2008.

There are some 1.5 million surplus properties in Spain with 563,908 of these being new-build dwellings, recent figures from Spain's public works ministry reveal.

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Spain to give young mid-income earners €250 monthly rental allowance 

Spain’s Prime Minister announced on Tuesday his government will launch a housing scheme whereby 18 to 35 year olds who earn below €23,725 gross per year will be able to get a monthly discount of €250 off their rent.

Spain to give young mid-income earners €250 monthly rental allowance 
The average Spaniard leaves the nest at 29.5 years of age. Photo: Gabriel Bouys/AFP

Spanish PM Pedro Sánchez made the announcement during an Urban Affairs Forum in the southern city of Seville, referring to it as a “special plan” aimed at ensuring the emancipation of young people in the country.

“We’re going to create a youth housing benefit of €250 per month for the next two years which will benefit young people between 18 and 35 years old with incomes below €23,725,” Sánchez stated, meaning that these tenants will be able to claim a maximum of €6,000 in total.

The most vulnerable families will receive extra state aid to cover “up to 40 percent” of their monthly rent.

The income limit of €23,725 gross earnings a year amounts to wages of around €1,500 net a month. 

According to a September survey by Spanish property engine Fotocasa, 62 percent of under 35s in Spain face financial obstacles when buying or renting a property.

“We’re going to allocate a public policy specifically to reduce the age of emancipation which is so unbearably high in our country, so that young people can have access to decent rental housing,” Spain’s PM explained. 

The average Spaniard leaves the nest at 29.5 years of age, the sixth latest bloomers in Europe, where the average age of emancipation is 26.2 years old.

Sánchez’s announcement comes just as the Spanish left-wing coalition government of PSOE and Unidas Podemos have agreed on Spain’s Housing Budget for 2022, although the new legislation still has to be approved by the Spanish Cabinet. 

This is likely to include new measures aimed at placing price caps on rentals in Spain, based on a price index put together by Spain’s Ministry of Transport and Urban Affairs.