Indices suggest bargains can be found in Spain

An increase in demand for property in Spain could be seen in the coming months as investors look to take advantage of low prices across the country.

Real estate values are expected to continue their decline over the next year, with an oversupply of homes on the market and rising interest rates ensuring that buyers can pick up a bargain.

Spanish Property Insight has collated data from major price indices and forecasts, with all of them suggesting that prices are falling.

Idealista, Tinsa, Standard & Poor and BBVA, all project that Spanish property values will continue to fall by between 4.4 and 10 per cent in 2011, on top off falls of up to 50 per cent since the market peak.

The greatest declines expected to be recorded along the Mediterranean Coast.

Just last week, Peter Mindenhall, a researcher at IPINGlobal.com, suggested that average prices in Spain will fall further when the banks reveal the backlog of distressed property on their books.

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