The number of properties sold in Spain in February dropped 1.1% year-on-year and 5% compared to the previous month, the National Statistics Institute said on Monday.
In last data to be collected before native transmissions of the coronavirus hit Spain, the residential sector fared worse month-on-month, down 6%, though year-on-year it gained 0.1%.
Spain’s property market has had a rollercoaster two decades, with a slow but steady recovery in the past eight years as it emerged from a near six-year recession provoked by the explosion of a real estate bubble in 2007.
The autonomous regions of Catalonia and Madrid, both real estate powerhouses, saw their property sales stumble 4.4% and 3.2% respectively year-on-year for February.
The two regions registering the steepest annual drop in property sales for the month were La Rioja at 36.4% and the Basque Country at 20.7%.
However, sales ballooned between 8% and 12.7% year-on-year in the Balearic Islands, Andalucia, and Aragon.
The nationwide rate of property transfers, for its part, slackened by 1.1% compared to the same month last year, representing a compound annual fall of 2.9%.
Meanwhile, Madrid and Catalonia saw property transfer rates tumble 8.2% and 6.2% respectively relative to February 2019.
“A great deal of (real estate) transactions were paralysed during 2019 due to the introduction of the Mortgage Law,” said Ismael Kardoudi, research director at property portal Fotocasa, referring to a 2019 law which imposed more stringent controls on lenders and the mortgage process.
“The February data shows we have left this law’s consequences behind us.”
Spain’s GDP could suffer a hit of 4.7% in the first quarter of 2020, the Bank of Spain said on Monday. Real estate represents one tenth of GDP, according to the statistics body.
