Central bank says house prices must fall further
Falls have averaged 15.4 percent in nominal terms since first quarter of 2008
The Bank of Spain on Wednesday predicted that home prices would continue to fall for the next two years as the property market strains to adjust to an over-supply of houses built up during a massive boom that turned to burst at the start of 2008.
"The correction in prices has still to run its course," the head of the central bank's research department, José Luis Malo de Molina, said at a seminar on the property sector.
According to official figures, house prices have fallen an average 15.4 percent in nominal terms since the first quarter of 2008 and 20 percent after taking into account the impact of inflation.
Malo de Molina predicted prices would fall a total of 30 percent in real terms before they start to bottom out at the end of next year or the beginning of 2013.
