Spain: Home prices fall to 2004 levels
October 19, 2012
In July, the Spanish Board of Architects (Colegio de Arquitectos Tecnicos) granted 4,022 new construction permits, according to data published by the Ministry of Public Works (Ministerio de Fomento). The reading was up from the 3,502 permits approved in June. On an annual basis, permits plummeted 44.4%, which nevertheless represented an improvement over the 59.0% fall recorded in June. As a result of the monthly figure, the moving 3-month sum totalled 11,472 permits in July, which represents a 48.6% decline over the same period last year. The figure remains close to the record low of 11,251 permits reached in the previous month, indicating that the housing market remains depressed. At the current level, permits are only a fraction of the record-high 268,266 permits given during the peak in the July-September period of 2006. In addition, housing prices continue to decline. The general index of housing prices produced by the Ministry of Public Works dropped 9.5% year-on-year in the third quarter, which marked a deterioration compared to the 8.3% decline observed in the second quarter. As a result, the price per square metre reached EUR 1,566 in Q2, which is 25.5% below the peak of EUR 2,101 per square metre recorded in Q1 2008 and brings home prices back to levels last seen in 2004.