Banks to control Spanish property market in 2011

Banks are expected to be the main driving force behind the Spanish property market in 2011, it has been claimed.

Giving his views on the Property Secrets blog, market commentator Daniel Talavera explained that the fact that banks are currently holding the largest property portfolios is likely to work in their favour.

It is generally expected that banks will begin to flood the market with below market value distressed property in order to balance their books.

"Despite the fact that banks portfolios do not seem to be good, generally, they are ready to lend money to reduce their stock as long as the buyer has some payment guarantees. Banks are the easiest option," Mr Talavera said.

The expert added that those looking to buy property in Spain in the coming year should also expect to benefit from reduced prices.

Mr Talavera explained: "Property prices and land prices have dropped in 2010, an average of five per cent to ten per cent in cities; whereas the fall was between 30 per cent and 50 per cent in coastal and second residences."

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