Spanish land prices are falling in response to the downturn in the property market.

price of urban land in Spain fell by a national average of 2.7% to 277 euros/m2 in the last quarter of 2007 compared to the previous year, according to figures from the ministry of housing. On a quarterly basis, land prices fell by 2.8%. Regional variations in falls were substantial, from as little as 1% in some provinces, to 41% in Leon, 33% in Alicante, 25% in Cordoba, 15% in Barcelona, and 13% in Malaga.Spanish land prices are falling in response to the downturn in the property market. Prices are also being pushed down by the number of developers with liquidity problems who are having to sell land to raise cash.The cost of land represents, on average, 30% of the cost of a new property, though in some areas like Madrid it can be 50% or more. Falling land prices should enable developers to lower their prices, but this will take time to happen, if at all. Developers have an estimated stock of 500,000 unsold newly built properties to sell before the fall in land prices will flow through to property buyers.