The American housing crisis is echoing in Europe, where home prices are dropping after a decade of rapid growth. The damage is limited, however, by intercontinental differences. High interest rates and shaken confidence are catching up to prices in France, Ireland, and particularly Spain, where new home construction had spurred major growth but permits are now plummeting, the Journal reports.
Higher mortgage payments may even seep into consumer stats, because more people say they have less to spend. But the Continent is in a better position than the US—lenders are not as quick to write subprime mortgages or approve home-equity loans. Some countries aren’t feeling the heat: Germans prefer renting and are therefore sitting pretty.