Imf: spanish house prices have bottomed

Alicante, Costa Blanca Photo: A Montero C

Spanish house prices have already bottomed out, according to the International Monetary Fund.

The IMF's Multi-Country Report for January, which tracks the progress of the housing markets in Denmark, Ireland, the Netherlands and Spain, concludes that all four countries have "undertaken important measures" to facilitate their recovery from the boom-and-bust legacies.

"These countries’ experiences share similarities, but also important differences," says the report. "Shocks to house prices, unemployment, and banks have been most severe in Ireland and Spain, reflecting in part a higher amplitude of residential construction."

The IMF concludes that all four markets have come to or may be near their lowest point, with some of the countries already seeing property prices rise.

"Price-to-rent and price-to-income ratios are now only about 0-15 percent above their historical averages in all four countries," reads the report. "Real house prices have already begun to stabilize in the Netherlands and rise in Denmark and Ireland."

Indeed, property price indices have showed mixed yet positive results in the past 12 months, with property values seeing their first increase in September for several years, according to Tinsa.

The positive mood has sparked a wave of foreign interest in the country's real estate market, as buyers snap up bargain holiday homes in popular hotspots such as the Costa del Sol, and investors plan for future capital growth. Figures from the INE last year showed that sales had soared by 20 per cent in October 2014 compared to the previous year.

On TheMoveChannel.com, demand for Spanish property hit a 12-month high in November 2014, while in December, the US and Spain were both neck-and-neck in the race to win over the most buyers: the countries each accounted for 1 in 10 enquiries on the property portal.

"Further reforms could help continue and accelerate the recovery process," adds the IMF.