Estate agents’ signs advertise apartments for sale in Madrid. Spanish property prices have already dropped by 28pc from their peak in March 2008 and face a fall of 8pc this year and 5pc next year Photo: Bloomberg News
telegraph.co.uk / By Ambrose Evans-Pritchard / 5:06PM BST 29 Apr 2013
Spanish house prices are to fall a further 13pc by the end of next year as the authorities flood the market with a backlog of repossessed properties, Standard and Poor’s has warned.
The agency said the housing slump is deepening across large swathes of the eurozone. French declines are “gaining momentum”, with prices likely to fall 5pc this year and a further 5pc in 2014.
French property faces a “protracted correction” as the economy buckles, hit by fiscal tightening, higher taxes and a surge in unemployment to post-war highs.
France’s price-to-income ratio rose to a record 180pc of historic levels during the bubble, one of the most stretched levels seen anywhere in the OECD bloc.
The property market began to roll over last year, prompting warnings by the French consultants PrimeView that values could tumble by as much as 40pc before excesses are purged.
S&P said the deep crisis in the Netherlands would grind on despite the government’s partial retreat from austerity and its decision to delay €4.3bn in spending custs.