Domestic demand should be further supported by our monetary policy measures and their favourable impact on financial conditions, as well as by the progress made with fiscal consolidation and structural reforms. Moreover, the decline in oil prices should provide support for households’ real disposable income and corporate profitability and, therefore, private consumption and investment.
One reason of course relates to the willingness of banks to allow arrears to accumulate without foreclosure. This reduces the supply of properties on the market. (Impatient buyers who want to occupy may be prepared to buy even though they know the price is above equilibrium. There may be more of these than of impatient sellers, given the patience of banks.