House prices overvalued says Spain's Caruana

Bank of Spain Governor Jaime Caruana Wednesday said that in the central banks view house prices are overvalued as a result of an extended property boom, but ruled out the possibility of a "disorderly adjustment" in the market.

"It is evident that there is a significant degree of overvaluation in the property market, which has been growing progressively," Caruana told a seminar on the financial sector. "A gradual correction in the current imbalance is foreseeable and desirable," he added.