Spain Business Brief - Tuesday June 30 2009
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By h.b. - Jun 30, 2009 - 12:26 PM
House prices fall by 7.6 percent over the year in Spain with resale properties down by 12.5 percent

House prices in Spain have fallen by an average 7.6% in price over the year to March, according to data from the INE, National Statistics Institute.
The fall is a consequence greatly of the fall in the value of resale property, which is down in price by 12.5%. New property was 2% cheaper than a year ago. It’s the largest fall since the collapse in the real estate market in Spain.
The areas most affected by the bursting of the real estate bubble are Cataluña, Madrid, and the Basque country, while the lowest falls were seen in Melilla, Galicia and Murcia.
It means that house prices have fallen by more than 20% since the start of 2007.

The Euribor interest rate, used to set most of the mortgages in Spain, has reached a new all time low and ends June at 1.61%. It means that those who have their mortgage payments reviewed annually this month, they will see a saving over the year of 3,400 €. It means the average monthly payments will be 284 € cheaper.

Following the publication for the advanced inflation number in Spain for June yesterday, at -1%, today we hear that inflation across the Eurozone as a whole is negative for the first time, at -0.1%. The number from Eurostat uses data for May.

The union of Catalan savings banks now seems likely with the help of public money. The President of the Catalan region, José Montilla, is supporting the merger of the savings banks of Terrassa, Manlleu and Sabadell.
Expansión newspaper claims the three banks have asked for 300 million € help for the deal which will see the closure of 150 branches and the sacking of 400 workers.

The so-called last resort tariff for electricity in Spain comes into effect tomorrow with a 2% increase in power prices. Most consumers remain confused by what is going on, but with the Government announcement we can now expect more advertising from the companies fighting for clients following the liberalisation of the sector.

And finally,
Telefónica is taking the first steps towards a single facture which will all your charges for ADSL, land line and mobile phone. It’s part of a restructuring of the company which will also reduce the use of the Telefóncia name, preferring instead the Movistar brand. The company is also introducing a new offer of free calls from land lines to mobile for families. Calls are free for a monthly payment of 3 € per line per mobile, for members of the same family. It’s called the Solución Familiar and allows a maximum of 250 calls a month, or 500 minutes per line.

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