ECB sees end to eurozone housing slump

9th December 2010, Comments 0 comments

A general slump in eurozone housing prices ended early this year, but the recovery will reflect the patchwork pattern of growth across the region, the European Central Bank said on Thursday.

New data showed that "euro area house prices increased in the first and second quarters of 2010 by 0.3 percent and 1.8 percent year-on-year respectively," the bank said in its monthly bulletin for December.

"This compares with a yearly contraction of close to 3.0 percent recorded in 2009," it added, when the bloc ploughed through its first recession.

The ECB referred to a new quarterly property price index based on information compiled by the Eurosystem of its member central banks.

Mortgage loans have also turned a corner and increased availability of financing has boosted several markets, though regions where housing booms got out of hand before the bubbles burst are expected to take longer to recover.

The ECB cited "divergent developments across the euro area countries," with Estonia, Greece, Ireland, the Netherlands, Slovakia and Spain continuing to see declining house prices in the second quarter of the year on a 12-month basis.

Estonia is to become the zone's 17th member on January 1.

Meanwhile, "the largest annual house price increases in the second quarter of 2010 were seen in Belgium, France and Finland," and seem to result from developments around their respective capitals of Brussels, Paris and Helsinki.

© 2010 AFP

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