Staff reporter
SPANISH house prices rose 17.4 percent annually in the second quarter, confirming a persistent price rise that led the government to create a Housing Ministry to try to contain them.

Prices rose 4.7 percent on a quarterly basis, up from a 4.1 percent rise in the first quarter, the ministry said in a statement this week.
By cities, Malaga showed the sharpest annual increase at 27.5 percent, followed by Valencia at 23.1 percent and Seville at 21.2 percent.
The data referred to properties not subject to price controls.
Aided by demographics and historically low interest rates, Spanish property prices have doubled in the past five years amid record housing production.
The Bank of Spain has said it considers housing prices to be 20 percent overvalued.
The Socialist government created the Housing Ministry upon taking power after winning March 14 general elections.

At the end of the second quarter of this year, the average price of housing, new and used, in the Balearics, per square metre, was 1.960'85 - 15.43 percent up on the same period last year.

What is more, since the start of the year, the price of housing has steadily risen by 10.70 percent.
While the Balearic increase has been slightly below the national average, it has nevertheless been the second highest rise in Spain.
Housing in the region is still the fourth most expensive in the country. Only in Madrid, where the average price of housing is 2.808'9 euros per square metre, the Basque Country 2.348'9 euros and Cataluña, 2.078'3 euros, are property prices higher.

Both local and central governments are trying to ease house prices while trying to help young people get their first foot on the property ladder.
In the Balearics, the government is providing cash incentives and tax relief to first time buyers under the age of 35.
Nevertheless, the second home market is still very active with British home owners continuing to cash in on the UK property boom, and the low-cost airline links, by selling up and buying their dream homes in the sun. Or they are relocating the family and setting up a new base in the Balearics while keeping a small home in the UK.

Majorca is continuing to prove extremely popular with the British dominating the market this year. Removal companies claim to have never been so busy and the traffic is all one way, from Britain to Majorca.


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