Foreign investor confidence 'needs to return to the Spanish property market'

In order for the Spanish property market to fully recover, foreign investors need to regain confidence in the sector, it has been claimed.

The latest figures released by Tinsa show that prices and transaction levels in the country are improving, but overseas investors are still not returning to the market.

According to the Ministry of Housing, during the first three months of the year non-residents bought just 513 holiday homes, something which needs to increase if a full recovery is to take place.

Mark Stucklin, of Spanish Property Insight, claims that if the figures are correct then the rate of decline in values of homes has been slowing since June 2009.

"If the trend towards smaller declines keeps up, average property prices will be stable, or even growing slightly before the end of the year," he explained.

"There are tens, if not hundreds of thousands of holiday homes for sale on the coast that will need to attract foreign buyers in large numbers if the holiday home glut is to be dealt with anytime soon."

Overseas investors looking to find property in Balearic Islands could be interested in news that searches for homes in the destination increased by 3.65 per cent in May 2010 compared to May 2009, figures from Rightmove Overseas have shown.

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