Home prices in Spain fell 4% in May compared with a 10.4% drop recorded in May 2013, indicating that the market could be nearing the bottom.
The data from the leading valuations company Tinsa index also shows that this was the lowest annual drop in May since 2008.
The biggest price declines were on the Mediterranean coast, down 7.9%, but even that was the slowest drop since 2010. Madrid saw the smallest fall at 3.3% and other large cities also saw smaller than usual price declines.
Recently released figures from the National Institute of Statistics showed a 1.6% annual decline in prices recorded in the first quarter of the year compared to a 7.8% annual decline in the fourth quarter of 2014. On a quarterly basis prices fell 0.3% compared to a 1.3% drop in the fourth quarter.
The annual drop in new housing prices was 1.1% with second hand homes dropping in value 1.7%, both significant improvements over the previous quarter.
There was some regional variation. Madrid saw prices rise by 1.9%, the first increase in the capital since 2010. Prices on the Balearic Islands, including Ibiza and Mallorca, recorded an increase for the first time since 2008. The biggest increase was in Murcia, one of the area’s hardest hit by the market collapse.
Last week data released by Spain’s Development Ministry showed a 0.5% decrease in home prices in the first quarter, a 3.5% drop from the first quarter a year ago and the twenty second quarterly drop in a row.
And the latest property report from notaires talked about signs of stability with sales picking up in the first quarter of 2014 and prices up 1.6% compared to the previous quarter, although prices in March were still 4.8% below prices in March of 2013.
According to expert Mark Stucklin of Spanish Property Insight it is good news that the various indices are in agreement that the price declines are slowing and a sign that the bottom of the market is not far off.
‘Prices and sales are still struggling, but the declines have slowed and there are increasing signs of stabilisation. The similarity in the trends reported by the different agencies is worth noting,’ he said.
‘Typically, Spain’s different housing market barometers can be confusing, with each report posting radically different numbers. And the specific housing data is often impacted by several factors which have nothing to do with supply and demand. That’s certainly true over the last year, when changes in tax laws help boost sales,’ he explained.
‘But the latest reports been remarkably consistent. The Tinsa data reflects the same distinct movements as the other reports released in recent days, suggesting that a real trend can be identified,’ he added.