The fall in the leading index of share prices in Spain the Ibex as reported this Wednesday, is a trend which is worrying the ministers of finance in Madrid.
Mortgage rates in Spain have been rising progressively over the last year and forecasters have already advised that they will continue until early next year.
With stories of corruption in the town halls, building, planning and construction industries as a whole occurring on an almost daily basis, it is no surprise that the property market is slowing, with foreign investors moving to further afield.

It is the foreign investors in Spain who have propped up the fiscal system of the Spanish over the past years. The PSOE governing party is strongly left wing, frivolous is its financial structure with little idea of how to operate monetarily apart from hoping to sell more properties to foreigners in order to tax them and therefore inject cash into the system. The vast sums which have come to buy properties in a single unidirectional stream has been placed into the pockets of the wealthy either by luck corruption or infamy.

Unfortunately many of the buildings sold are now finding themselves placed onto a resale market that very few foreigners trust. Many have been sold houses that are not suitable for investment, either because they are of poor quality, are too small to be lived in, wrongly placed for apartments or buyers are put off by the practises of lone Inmobiliarias. This is bad news for those foreigners who speculated their life savings expecting a return, but good for those selling new properties.

Spain is still a good place to invest, but investors must look wisely at what they are getting in return. Let us all hope this is the end to tiny plots and flats and that the town halls will allow the large villas, both the northern European investors and the Spanish people want to live in. It would also be highly advantageous for the Spanish government to regulate the market and reduce both corruption and the devious practises of those few unscrupulous developers who will, by incompetence, corruption and greed ruin both the market and the remainder of Spain.

The Spanish economy is not in a position to neglect the foreign investors and unless the Spanish government wants to turn the populace back to being Franco's shepherds in the fields, it should think of the future now.