I note on redNet's property price monitor that whereas prices in Warsaw as a whole increased by 0.1% in March, in Mokotow they fell by about 4%. I recently bought in Galeria Park II and there are now 16 of the earlier stage units in this development on redNet's listings at a much cheaper sqm than I bought at. We were told the next tranche of these flats would be released soon at higher prices than those of PS to the local market. I can't see how this is going to happen with those still available at the lower price.

Agreed, FDI is likely to fall over the coming months. What worries me more is the effect of a crash in Spain and Ireland. The crash in Spain is all over the news the last few days, 1000s of Brits are gonna feel it. It effects everyone invested in Spain especially those people who are leveraged to the hilt. Its just one more piece of news that keeps on chipping away at investor confidence, - there will be a tipping point leading to big falls. As for bad news, this is just the start ..... there will be tv programs and news articles, then further interest rate hikes, oh and I think the stock markets are likely to fall heavily. The Pound is MASSIVELY overvalued - gonna crash too. We are talking a Western world slow down - as spending stops it will cause a fall in imports in CHina and India = Global recession. Gotta invest where the fundamentals are strong and where there is no speculative boom.

Dear Richard, What evidence do you have that there is a crash in Spanish or Irish property? All we have seen this week is i) a revaluation of stocks (real estate sector) which ends the speculation on Spanish stocks (real estate) and ii) evidence of some inside dealing type issues within Astroc. We know that prices growth is slowing but a crash? Why do you think FDI will go down? Our evidence is that Spanish investors are charging to the East and spending a lot of money and this latest episode will only increase the FDI. Where do you get you data to show FDI slowing down? In fact, real estate companies partly recovered yesterday from the stock losses and the Spanish stock market is still calm. I do not think that a “bad Tuesday” for the Spanish real state shares in the stock markets is a sign of a crash in the property market. Just a sign that there had been too much stock speculation earlier this year. From our point of view a property market will collapse ONLY when both of these two factors are in play. Both a rapid rise in unemployment and a rapid rise in interest rates. The supply of properties into the Spanish market is slowing rapidly, however there are some imbalances at the moment and we believe this will offer opportunities later this year. Many Spanish developers are investing in other countries, which will reduce the supply of properties in Spain. This means, the demand and the offer are going to be equalized. Therefore, our point of view is that the Spanish market is reaching a point of maturity instead of collapsing. The supply of properties is slowing down (but currently too high) and that demand will continue to be strong as Spain is a creator of new jobs.

Im afraid it is not the reality of the situation that drives the market. It is investor confidence that dictates the driving force in terms of capital growth. Headlines in the business section of the FT and also in the Telegraph + many more papers all use the word "crash". It is investor confidence that is KEY - and that is taking a battering at the moment and this Spanish property blip WILL become something more in the short to long term. As ive said in previous posts - the negative media predictions are essentially self fulfilling prophecy's. There is no arguing that the trend is now toward the negative - and I do not see the situation changing. Regards, Richard.

Hi Richard I've watched your comments about a property market crash with interest. I've written an article in response to this whole discussion - you can read it here: http: / /www .propertysecrets .net /article /1609 .html Cheers