Spanish property prices are heading for a further drop in 2014, says the US Ratings Agency, Moody’s. Due to “excessive stock and weak demand” property prices in Spain will continue to decline this year.
" Even though the banks expect a stabilization in 2014 , residential mortgages continue to deteriorate in Spain throughout the year and those loans with higher ratios ltv (loan -to- value) will be the main factors of default "
According to the report by Moody 's, the Community of Madrid has the highest default rate (11.4%) in Spain, followed by Castilla La Mancha (11.3%) , Murcia (11.1% ) and Catalonia (10 , 6% )
Moody’s also suggests that Foreign-borrower loans are 3.3 times more likely to default based on the fact that the unemployment rate in the second quarter of 2013 among foreigners was 35.7%, much higher than the 24.7% among Spaniards.