This graph shows that housing prices have decreased by 27% from their peak and are at the level that they were in 2004. This report on Spain predicts that prices will continue to fall by around 30% based on the 50% decline in the prices of housing in Ireland after the bust. The report suggests that Spanish banks which have been funding Spain's sovereign debt by borrowing from the ECB, will be put under pressure as housing continues its decline. The Spanish government will not be able to bailout the banks on its own accord. The conclusion of the report is that Spain will need a rescue plan soon.
Wednesday, March 28, 2012
Housing Prices In Spain Continue To Fall And A Need For A Rescue Is Predicted
This graph shows that housing prices have decreased by 27% from their peak and are at the level that they were in 2004. This report on Spain predicts that prices will continue to fall by around 30% based on the 50% decline in the prices of housing in Ireland after the bust. The report suggests that Spanish banks which have been funding Spain's sovereign debt by borrowing from the ECB, will be put under pressure as housing continues its decline. The Spanish government will not be able to bailout the banks on its own accord. The conclusion of the report is that Spain will need a rescue plan soon.
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