Spanish real estate has had its first official good news since the collapse of the market, with home sales increasing last year for the first time since 2007.
The latest figures from the country’s National Statistics Institute (INE) show property sales in Spain rose 6.8% in 2010, which, whilst still significantly down on boom-time levels, marks a huge turnaround from the vast decline of the previous two years.
Property sales totalled 441,386 in Spain last year, compared to 775,300 at the height of the boom in 2007. When the financial crisis, combined with a glut in supply caused by overdevelopment of many tourist areas, caused the property bubble in the country to burst, sales began to decrease rapidly. The INE reported a 28.8% decline in 2008, followed by an equally dramatic 25.1% contraction in 2009.
While some speculators say prices have yet to hit their lowest, the modest yet significant 6.8% sales growth for 2010 may indicate that the worst of the crisis is over. With the government having embarked on a full-scale public relations campaign to lure disillusioned British buyers back to the market, and Prime Minister Jose Luis Zapatero’s efforts to overhaul the banking and labour market sectors, 2011 is likely to see a further slow increase as the country’s economic crisis begins to recede.
