The residential bubble in Spain saw Real Estate prices rise 247% from 1997 to 2005. The mortgage of Spanish families in the second quarter of 2005 is € 651,168,000,000. This debt at 25% per year from 2001 2005 (with 97% of mortgages at variable rate interest). In 2005, 528,754 new properties were in Spain. 2004 estimations of demand are 300,000 for Spanish people, 100,000 for foreign investors, 100,000 for foreign people living in Spain and 300,000 for stock; in a country with 16.5 million families, 22-24 million houses and 3-4 million houses. From all the houses built the 2001-2007 period, than 28% are vacant as of late 2008.

House ownership in Spain is 80%. The ownership feeling was inducted by the government in the 60s and 70s, thus being deeply in a Spaniard's mind. Apart from that, tax regulation ownership: 15% of your mortgage payments is deductible from your income taxes, nothing if you pay a rent. Even more, the oldest part of the apartments suffer from non-inflation-adjusted rent-controls and eviction is slow, discouraging renting.

feared, when the speculative bubble popped, Spain has been one of the affected countries. According to Eurostat, over the June 2007-June 2008 period, Spain has been the European country with the plunge in construction rates. Actual sales over the July 2007-June 2008 period were down an average 25.3%.

Banks offer 40 years and, more recently, 50 years ones. As opposed to the Ireland case, in Spain the labor cost does not follow the of the house market in the same proportion. some observers suggest that a soft landing is likely, others suggest that a crash in prices is probable. Lower home prices will low-income families and young people to enter the market. However, there is a strong perception that house prices never . As of August 2008, while new constructions have come virtually to a , prices have not had movements, neither upwards nor downwards.