Spain: Housing market still depressed
July 30, 2012
In May, the Spanish Board of Architects (Colegio de Arquitectos Tecnicos) granted 4,029 new construction permits, according to data published by the Ministry of Public Works (Ministerio de Fomento), which was up from the 3,801 permits approved in April. On an annual basis, permits declined 38.2%, a deterioration over the 35.8% fall recorded in April. As a result of the monthly figure, the moving 3-month sum totalled 12,678 permits in May, which represents a 34.7% decline over the same period last year and marks, in fact, a new record low, indicating that the housing market remains depressed. At the current level, permits are only a fraction of the number given during the peak in the July-September period of 2006, when 268,266 permits were granted. In addition, housing prices continue to decline. The general index of housing prices produced by the Ministry of Public Works dropped 8.3% year-on-year in the second quarter, which marked a deterioration compared to the 7.2% decline observed in the first quarter. The price per square metre reached EUR 1,606 in Q2, which is 23.6% below the peak of EUR 2,101 per square metre recorded in Q1 2008.