Editing Economy of Spain (section)

==== Property boom and bust, 2003–2014 ====
{{Main|Spanish property bubble|2008–2014 Spanish real estate crisis}}

The adoption of the euro in 2002 had driven down long-term interest rates, prompting a surge in mortgage lending that jumped fourfold from 2000 to its 2010 apex.<ref name="housingcrash">{{Cite news|url=https://www.bloomberg.com/news/articles/2016-11-29/spanish-millennials-spurn-owning-homes-as-they-shift-to-rentals|title=Housing Crash Turns Spain's Young into Generation Rent|work=Bloomberg |access-date=29 November 2016 | first1=María | last1=Tadeo | first2=Sharon R.| last2=Smyth| date=29 November 2016}}</ref> The growth in the property market, which had begun in 1997, accelerated and within a few years had developed into a [[Spanish property bubble|property bubble]]. It was financed largely by "Cajas", which are regional savings banks under the oversight of regional governments, and was fed by the historically low interest rates and a massive growth of immigration. Fueling this trend, the economy was being credited for having avoided the almost zero of some of its largest partners in the EU, in the months previous to the global [[Great Recession]].<ref>{{cite web|url=http://stats.oecd.org/WBOS/ViewHTML.aspx?QueryName=198&QueryType=View&Lang=en|title=OECD figures|publisher=OECD|access-date=13 August 2008|archive-date=9 May 2008|archive-url=https://web.archive.org/web/20080509001824/http://stats.oecd.org/WBOS/ViewHTML.aspx?QueryName=198&QueryType=View&Lang=en|url-status=dead}}</ref>

Over the five years ending 2005, Spain's economy had created more than half of all new jobs in the EU.<ref>{{Cite news|url=https://www.theguardian.com/world/2006/jul/26/spain.gilestremlett|title=Economic statistics|work=The Guardian|location=London |access-date=13 August 2008 | first=Giles | last=Tremlett | date=26 July 2006}}</ref><ref>{{cite web|url=http://www.la-moncloa.es/NR/rdonlyres/2E85E75E-E2D9-4148-B1DF-950B06696A6C/74823/Chapter_2.PDF |title=Official report on Spanish recent Macroeconomics, including tables and graphics |access-date=13 August 2008 |publisher=La Moncloa |url-status=dead |archive-url=https://web.archive.org/web/20080726044742/http://www.la-moncloa.es/NR/rdonlyres/2E85E75E-E2D9-4148-B1DF-950B06696A6C/74823/Chapter_2.PDF |archive-date=26 July 2008 }}</ref> At the top of its property boom, Spain was building more houses than Germany, France and the UK combined.<ref name="housingcrash"/> Home prices soared by 71% between 2003 and 2008, in tandem with the credit explosion.<ref name="housingcrash"/>

The bubble imploded in 2008, causing the collapse of Spain's large property related and construction sectors, causing mass layoffs, and a collapsing domestic demand for goods and services. Unemployment shot up. At first, Spain's banks and financial services avoided the early crisis of their international counterparts. However, as the recession deepened and property prices slid, the growing bad debts of the smaller regional savings banks, forced the intervention of Spain's central bank and government through a stabilization and consolidation program, taking over or consolidating regional ''"cajas"'', and finally receiving a bank bailout from the [[European Central Bank]] in 2012, aimed specifically for the banking business and "''cajas"'' in particular.<ref>{{Cite news|last1=Minder|first1=Raphael|last2=Kanter|first2=James|date=2012-11-28|title=Spanish Banks Agree to Layoffs and Other Cuts to Receive Rescue Funds in Return|language=en-US|work=The New York Times|url=https://www.nytimes.com/2012/11/29/business/global/european-commission-approves-bailout-of-four-spanish-banks.html|access-date=2022-01-11|issn=0362-4331}}</ref><ref>{{cite news|author=Giles Tremlett in Madrid |url=https://www.theguardian.com/world/2012/jun/08/spain-savings-banks-corruption |title=The Guardian, Spain's savings banks' 8 June 2012 |newspaper=The Guardian|date= 8 June 2012|access-date=26 April 2013 |location=London}}</ref><ref>{{cite news |last=Mallet |first=Victor |url=http://www.ft.com/cms/s/0/d8411cf6-bb89-11e1-90e4-00144feabdc0.html#axzz2GDPWPST5 |archive-url=https://ghostarchive.org/archive/20221210211222/https://www.ft.com/content/d8411cf6-bb89-11e1-90e4-00144feabdc0#axzz2GDPWPST5 |archive-date=10 December 2022 |url-access=subscription |title=The bank that broke Spain Financial Times |newspaper=Financial Times |publisher=Ft.com |date=21 June 2012 |access-date=26 April 2013 |url-status=live }}</ref> Following the 2008 peak, home prices plunged by 31%, before bottoming out in late 2014.<ref name="housingcrash"/>