02/04/2009 - Spain, housing prices still dropping

Home prices are still dropping in Spain. According to the national institute for statistics (INE) prices dropped 5.4% in 2008. The drop was mostly due to last year's 10.7% drop in value for existing housing. The price trend for new housing is also downward; in the first quarter of 2008 there was a 7.2% increase but the fourth quarter closed the year with an increase of only 0.8%. The data from the institute varies from results reported by the Housing Ministry which found a 2.3% drop in new housing prices in 2008. The difference is caused by the fact that INE uses data from the General Council of Notaries which registers data slower and delays the price curve for the sector. The largest price drops for housing prices were reported in Madrid (-10.3%) and Catalogna (8.1%).