Spain House Prices May Fall 52% in Economic Stress, Moody’s Says

Spanish house prices may decline as much as 52 percent in a period of economic stress, according to Moody’s Investors Service.

The forecast decline is based on a model combining factors such as homes price increases in the last 10 years and unemployment rates, analysts including London-based Nitesh Shah said in a June 6 note. U.K. home prices are the second most at risk in Europe, facing the prospect of a 42 percent drop.

The house-price stress rate is among elements the New York- based rating company used to update its methodology assessing residential mortgage-backed securities transactions in Europe. A total 27 transactions face negative rating actions as a result of the changes, the company said in a separate statement.

To contact the reporter on this story: Esteban Duarte in Madrid at eduarterubia@bloomberg.net

To contact the editor responsible for this story: Paul Armstrong at parmstrong10@bloomberg.net

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