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NEWS

• 2008 ends up with a 7,22% drop in housing prices
• Housing construction could observe a 50% drop in 2009
• Half of the households' incomes are dedicated to housing purchase
• Spain lags behind but measures are still to come
• 2008: Drop in Real Estate transactions
• Barcelona rentals on the rise
• Barcelona Properties opens new office

2008 ends up with a 7,22% drop in housing prices

According to data collected by El Preciómetro, the prices index of real estate portal Facilisimo.com, 2008 ends up with a 7,22% drop in housing prices in Spain. This drop keeps on going since august 2007.

Last year, this trend already sent some imminent changing signals given that housing prices has been increasing for 5 years (+5,59% at the end of 2006). In 2007, the evolution of housing prices lazed, that was the prelude of the drop observed at the end of 2008.

Catalonia

As far as the Catalane community is concerned, 2008 ended up with a general 8,65% drop in housing prices. It is almost 1,5 point more that the national average. Thus, if we add the decline that occured in 2007 in this community (-2,51%) it enables to offset the important rise which afected 2006 (+11,12%).

Its four provinces registered identical drops all along the year, Barcelone in the top of the list with -8,96%, just followed by Lleida (-8,64%), Girona (-8%) and a little bit further Tarragona (6,62%).

Ciudad Condal (Barcelona) ended up the year with a 10,69% breakdown in the real estate prices and the price of the m² is 4.292€.

10.188 millions Euros available for the new Housing Plan

After having been approved last Friday, the 2009-2012 housing plan includes a 10.188 millions Euros investment and will have as a goal to mobilize 34.000 millions in the form of loans for one millions households.

Housing minister Beatriz Corredor wants her plan to come into force in the beginning of 2009, in order that to coincide with the end of the previous plan. The goal is to make the transition between both of the plan easier; the text includes several transitory measures which come into force in 2009 in order to face the crisis that real estate sector is going through now.

Source: Invertia.com

Housing construction could observe a 50% drop in 2009

The Construction Technological Institute of Catalonia affirms in it “Euroconstruct” report that the construction rate of new housings will observe a 50% drop in 2009 comparatively to 2007 figures and will become stable in 2010 with a slight 2% decline.

Thus, we find the production volumes that we had in 1996 and 1997. The lack of necessary financing for new housings construction, the still elevated stock volume in the market and the drop in prices as a consequence of this latter constitute three factors which enable us to preview an “important decline of the production”. Nevertheless, 2008 ended up with more than 600.000 new built housings.

Fuente: Europapress.es

Half of the households' incomes are dedicated to housing purchase

According to the last data of the Bank of Spain, for the 2008 third trimester, Spanish households used a 48,7% of their gross incomes in order to finance the purchase of their housing. Almost 3 points more if we compare to the same period of the previous year and 2.2 points more than in 2007.

These data mark a contrast with the results obtained during the previous years. In 2005 this figure represented only 36,4% and 35% the previous year. These results underline the fact that in order to purchase housing, family' debt ratio remains at a very high level in particular through the increasing registered during the previous year.

Source: Europapress.es (27/10/2008).

Spain lags behind but measures are still to come

Housing minister Beatriz Corredor assures that renting market has still a long way to go with only 11% of households using this option whereas in other European countries this figure overtakes 40%.
She also thinks that in order to stimulate this market in Spain we should improve the quality of renting accommodation, which should be highly affected by the general drop in prices which is occurring. She takes advantage of her participation in the government session at the deputy congress and refers to the measures to come in terms of accommodation, like for instance the modification of urban rents and civil trials law. She aims to reinforce the tenant security.

Source : Invertira.com

2008: Drop in Real Estate transactions

The number of real estate transactions for accommodations during the second quarter reaches 155.861, that's to say 31,5% less than what was recorded during the last year at the same period.
The old accommodations note the higher decline with a drop of 46,9% in transactions whereas the new market has been dropping of 13,6%. If we just have a look over the past year (june 07 - july 08), the number of accommodations which have been sent raises 693.503, that is a drop of 25,3% compared with the same period last year.

Source: Elmundo.es

Barcelona rentals on the rise

The rental market in Catalunya has taken off, as evidenced by financial data gathered from deposits registered at Incasol (Catalan Land Institute). The standstill in second-hand and new home sales, triggered by the credit crunch, has given rise to an increase in offer and demand towards resulting in more rentals and lower prices.