Recession Brings Household Wealth Down to 2005 Levels

7/07/2014 – El Economista

Spanish households showed a €4.33 billion net worth in 2013, which indicates it had fallen back to 2005 levels. The main reason for that is the price slump during the recession.

According to a recent report by the Institute of Economic Studies (or IEE) and Madrid´s Association of Developers (Asprima), the real estate wealth of families in Spain declined by 25.2% since the 2008 peak (down by €5.79 billion).

The Bank of Spain calculates the wealth rate basing on predicted stock development, as well as the dwellings´ average sizes and prices per square meter.

The household richness has been climbing up year by year and began to fall in 2009, marking five consecutive years of way down by now.

On the other side, the study reveals that the mortgage debt of families exceeds €0.5 billion, that is 15.8% of net property value in hands of families and 87% of the Household Gross Disposable Income.

 

Original article: El Economista

Translation: AURA REE

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