The government of Andalucia, or Junta, announced yesterday a subsidy of 1 billion Euros to help liquidate the region’s property glut estimated at around 70,000 newly-built homes.

Like the ‘cash-for-clunkers’ programme used to subsidise car sales, public money will now be showered on house-hunters in Andalucia. But second home buyers can stay in their seats as the scheme only applies to local residents buying main homes. Even so, it could benefit foreigners living in Andalucia, and help lift the market out of its slump, which might lift prices for all types of property.

San Pedro de Alcántara (St. Peter of Alcántara) (pop: approx 26,500) lies on the main Costa del Sol coastal road the N340/A7 as well as the new toll motorway the AP7, 10 km west of Marbella in Andalucia, Southern Spain. It is easily accessed from either Málaga or Cádiz and via the C339 from Sevilla and Ronda. The nearest airports of Málaga and Gibraltar are both within an hours drive. It is situated in the fertile plain of the same name, Vega de San Pedro Alcántara, a broad stretch of coastal lowland surrounded in a semicircle by rugged hills. On the East the Sierra Blanca of Marbella, dominated by its highest peak Pico del Astonar (1.270 m.) better known locally as "La Concha" (The Shell) because of its resemblance to a fluted sea shell when viewed from the west. To the North, there is the Sierra del Real or El Real del Duque, the Sierra de las Nieves and those of Tolox, on the West of the town the Monte Mayor and, finally, closing the mountain line the Sierra Bermeja.

“Talk of a slump (in prices) is no longer fitting” said an official from the Housing Ministry yesterday during a press conference for the Ministry’s latest quarterly housing market figures. National average prices have fallen 8% over 12 months, from 1,780 Euros/m2 at the end of September 2008 to 1,634.7 Euros/m2 today. In real, inflation-adjusted terms, prices fell just 7%.