Spanish distressed property market set for 2011 expansion

Spain will see a marked increase in the number of repossessed and distressed properties coming onto the market in 2011, it has been suggested.

Fernando Acuna of Pisos Embargados de Bancos, a Madrid-based listings website, noted that there are currently about 100,000 foreclosed properties on the market.

Speaking to write-about-property.com, he predicted that this figure could triple in 2011 due to new rules enacted in September which have forced Spanish banks to be more open about their seized assets and to write down the value of all two-year old property assets by at least 30 per cent.

The website commented that such a trend is likely to spur Spanish property investors as prices are revalued.

"There finally seems to be a realisation that they [the banks] must acknowledge losses and start to think about real values if the market is to be able to move forward," it said.

"In short: they need to cut their losses and move on."

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