Fernando Verdasco’s defeat of Argentina’s Jose Acasuso to secure the Davis Cup was a bright spot for Spain this weekend as the economic situation there, once a major EU success story, continues to deteriorate.
We started following the Spanish market actively this spring as the real estate market there began to decelerate at a rapid pace. The collapse was preceded by years of massive speculation with new home construction hitting an annualized 700,000 by Q3 2007. The housing boom helped Spanish household debt balloon -in December 2002, total mortgage loans equaled 52% of GDP but by Q2 of this year it exceeded 99.5%. The bursting bubble and subsequent fall-off in new construction has predictably spurred higher unemployment with a decade record rise in Q3 to over 11%.
We are revisiting our work on Spain this week as part of our continuing work to explore relative value opportunities with the EU.
Andrew Barber
Director
We started following the Spanish market actively this spring as the real estate market there began to decelerate at a rapid pace. The collapse was preceded by years of massive speculation with new home construction hitting an annualized 700,000 by Q3 2007. The housing boom helped Spanish household debt balloon -in December 2002, total mortgage loans equaled 52% of GDP but by Q2 of this year it exceeded 99.5%. The bursting bubble and subsequent fall-off in new construction has predictably spurred higher unemployment with a decade record rise in Q3 to over 11%.
We are revisiting our work on Spain this week as part of our continuing work to explore relative value opportunities with the EU.
Andrew Barber
Director
