Costa del Sol house prices have fallen significantly and will continue to do so, a Spanish research firm has said.

Property appraiser Tinsa has revealed that across Spain, prices dropped by ten per cent in the year ending January 2009, with the expectation being that this year could bring a further dip of up to 20 per cent.

The decline recorded over the 12 months included a 12.6 per cent reduction in prices on the Costas, the Daily Telegraph reported.

Such a trend may interest Costa del Sol property seekers looking for bargains in the region.

The news comes as Spain faces a deep recession and unemployment already at 14 per cent.

According to the projections of the International Monetary Fund, Spain will see an economic contraction of 1.5 per cent in 2009, something that may help drive prices down further.

Visit Rightmove Overseas for the best selection of Costa del Sol property. Stop dreaming, start searching!