Spanish property 'to become more affordable'

Spanish real estate prices will fall in 2010 as the country's property developers lower their prices to make homes more affordable and correct the market.

Writing for property portal Kyero.com, Spanish real estate expert Mark Stucklin said the main reason for prices not dropping as much as hoped was that the banks and developers owning homes did not want to damage capital ratios.

However, he noted, planned legislation has been announced by the Bank of Spain that will see banks forced to write off ten per cent of the value of any home they have held for a year or longer.

Mr Stucklin suggested this should lead to a drop in prices during 2010, with the possibility that banks may lower the amounts they are asking for ahead of any forced reductions to help bring about sales.

Head of research at overseas investment firm Property Frontiers Christopher Chadd recently remarked that the appeal of the sunny climate will keep luring Britons to France and Spain, irrespective of the state of the global property market.

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