The private banking arm of of Santander, Banif has suggested that Spanish property prices have still not dropped enough.

Property prices need to fall by an additional 27% in order for the oversupply to be absorbed and in order to reactivate the property market again, says the private banking firm.

According to Banif, the Spanish economy will not be in a position to create employment until at least 2012, given that it would require a GDP growth of 2.5% or more, something “difficult for Spain in 2011”.

The head of Banif in Andalucia, Extremadura and the Canaries, Manuel Sanchez Alarcón made the declarations at a presentation of a new study about the evolution of private banking after the crisis.