December 2010 TINSA index

The December Tinsa Spanish property price index report estimates that prices are falling at an inter annual rate of 3.6%.

This is the 36th consecutive month that TINSA have opined that residential property in Spain has fallen in value, with the Balearic Isles and the Mediterranean coast falling by the highest margins.

TINSA's index implies that prices aren't falling as steeply as before. Oversupply, massive unemployment and weak demand continue to drive down prices.

The market analytsts, Fitch, have estimated that the down turn in prices will continue throughout 2011.

The rate of decline has been slowing since a early 2009, a simple extrapolation of the change in rate indicates that the market should bottom late 2011. However other factors may come into play, forcing prices down further. The withdrawl of extra unemployment benefit in February and the repricing of Spanish properties held by the banks is likely to depress prices further.

This means that those wishing to move to Spain should probably consider renting rather than purchasing at this stage. It's a buyers market so take your time and start by making a low offer.

The TINSA index is based on the opinion of valuers, rather than actual sale price data. The word on the street is that there are some great bargains out there, but there is a lot of property over-priced on the market.

Original article Spanish Property Magazine