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Jul 12
2011
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The adjustment of the Spanish Real Estate SectorPosted by: David Mora Fumero in Real_Estate International Market on Jul 12, 2011 Tagged in: Untagged
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- In the closing months of 2010, the Spanish economy came back on track for recovery, with a q-o-q GDP increase of 0,2%, that sums up for a y-o-y increase of 0,6%.
- Excluding construction, the demand is recovering. Private consumption grew in 2010 at an average of 1,2% (from -4,3% in 2009) investment in equipment grew on average 1,8% (from -24,8% in 2009), and external demand rose up to 1,1%.
- GDP forecats confirm a positive evolution, in line with others European economies.
- Three major imbalances affected Spanish economy during the expansion years:1.- Excesive weith of Residential Real Estate in GDP2.- Rapid growth of credit and leverage in the private sector3.- Current Account Deficit (competitiveness and productivity)
- These imbalances are being rapidly corrected, laying the ground for healthier growth.
- Economic streghts and reforms lay the foundations of a sound and rebalanced growth for the Spanish economy.
- Price increase in Spain: fundamentalsFavourable macroeconomic enviroment. GPD growth over EU average.Substantial population increase and socioeconomic factors (immigration, household formation).Permanent real interest rate reductions effect, implying a permanent increase in assest valuations.
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