Pain in Spain May Linger as Banks Seek to Avoid Property Losses

[anarchist]

Banks bought about 110,000 homes to keep losses off their books as Spain’s property bubble burst, according to real estate researcher RR de Acuna & Asociados in Madrid. Now they’re using strategies reminiscent of the boom times -- 100 percent mortgages, low interest rates and free cars -- to sell homes, potentially slowing a drop in prices that’s needed to spur recovery from Spain’s worst recession in 60 years.

“Maybe you can create some accounting value with all these tricks, but in the end it doesn’t make the situation any better and in the long term makes it worse,” said Luis Garicano, a professor of economics and strategy at the London School of Economics, in a phone interview.

http://www.bloomberg.com/apps/news?pid=20601109&sid=aXWVn3mlVH4c

[wproie]

The pain in Spain falls mainly on the plain.