Tinsa is the country’s principal real estate appraiser and in its Spansh Property Market Index report for January the company states that prices have already plunged by 10.1% compared with January of last year which marks the first time they have shown a double digit year on year drop .
The largest fall was seen along the Mediterranean coast , where prices dropped by 12 .6 %.Metropolitan areas generally dropped by 10.9 %.The company forsees further price reductions due to a combination of factors including reduced demand , no availability of financing and a huge stock of unsold property .At the close of 2008 there were almost a million unsold properties and Tinsa expects this to rise to over a million and a half by the end of 2009 .
A report from the central government confirms that the number of unsold homes is growing and is suggesting that it could take until 2012 for much of this stock to be sold .The Industry Ministry’s Spanish Commerce Information bulletin has said that if the level of sales was to reach the same level as in recent years then the stock could be absorbed by 2010.As it seems highly unlikely that the sales of properties are going to return to these levels in the forseeable future then they are going to be around for a while .Therefore continuing to build homes should not be an option in many areas in the opinion of many groups .Many see the present problem as being caused by the overbuilding of homes , particularly along the coastlines .
