Spain's property crash casts a long shadow over a place in the sun | Money | The Guardian

Spain's property crash casts a long shadow over a place in the sun | Money | The Guardian

Spanish homeowners used to have little in common with the wealthy north Europeans snapping up holiday villas and apartments on the Costas. Now both are united in adversity. Both are suffering in a market preoccupied with falling values, negative equity, a glut of unsold new property and, in some cases, doubts about the legality of new estates.

An estimated 600,000 new homes, and 200,000 part-completed ones remain unsold, a sizeable proportion of which are in holiday areas. The Bank of Spain says official house prices have fallen 17% since 2007, but many observers believe that the market is much worse than that, as the bank's index is based on valuations, not achieved sale prices. Estate agents say prices of homes have typically fallen 20% to 50% in different parts of the country, with no sector unaffected.