Spanish property prices expected to fall a further 12%

The Standard & Poor credit rating agency believes that Spain has still not seen the bottom of the housing market crash and that the country is still “a long way to go” until improvements are seen, with prices falling by an estimated 12%.

The report states how there is a property surplus of around of 1 million homes, which should have brought greater fall in prices. Even though the developments of new homes has slowed to 'just' 300,000 a year, it is still expected that it will take many years to redress the balance.

Statistics quoted in the report reveal that house prices fell by 6.1 percent in the fourth quarter of last year. Overall property prices were estimated to have fallen by 5.3 percent in the last 12 months to March 2010 compared to June and 6 per cent in December 2009.