MADRID: The analysts at credit ratings agency Standard & Poor’s (S&P) are predicting that the slump in the Spanish property market will finally become a thing of the past by the end of this year, with an annual increase of 2.5% S&P analysts forecast property price increase in Spainforecast in the average price of homes in Spain.
The S&P report is based on the perception that the general economic recovery in Spain is gaining momentum, and the analysts also believe that prices will rise by another 2.5% in 2016 and by 4% the following year. This coincides with similar trends being observed in other European markets this year, the main causes being favourable financing terms and the general economic improvement.
Underlying all of this is the ECB’s policy of buying public debt, which leads to “ultra-low” interest rates even in the property markets which were worst affected by the financial crisis, according to S&P economist Jean-Michel Six. This is the case, for example, in Ireland and the Netherlands, where prices are expected to rise at an annual rate over the next two years of 5.5% and 3% respectively. The price increase in Ireland this year is expected to be 9%.
Other forecasts are for price increases of 5% in Germany this year (and 4.5% in 2016), 4% in Portugal and stability in Italy, while on the downside it is predicted that property prices will fall by 3% in France and 2% in Belgium. Outside the Eurozone, the UK market is also predicted to perform strongly, with price rises of 7% this year and 5% in 2016, while in Switzerland increases are forecast of 1.5% this year and 1% next year.
