The good news is that residential planning approvals appear to be stabilising after 4 years of stomach-churning declines. The bad news for everyone in the business of building homes in Spain is that planning approvals are still near record lows.

There were 7,412 residential planning approvals in September, according to figures from the Government. That is almost the same as September last year but still less than half the level 2 years ago, and just 16pc of what it was in September 2007.

On a year to date basis there were 70,166 planning approvals in the first 9 months of the year, 16pc less than the same period last year and 90pc less than the same period in 2006.

The chart above makes it clear just how dramatically the Spanish house-building industry and imploded in the last 4 years.

Estate agents complain about how difficult it is to sell in the current market, but their problems are nothing compared to those in the house-building industry such as developers, constructors and architects.

At times like this one tends to forget that nothing last forever, not even a house-building crash that feels as bad as this one. The time will come when Spain needs to start building homes again, though in some coastal areas it may still be years away.

First Sign of Shortages

But according to Beatriz Corredor, Secretary of State for Housing, shortages are already making themselves felt in the most sought-after areas “where families want to live.” In those areas new developments plans are back on the table, and prices may even be starting to rise, she recently told the Spanish press.

On the other hand, she also pointed out that some areas are still swamped with housing gluts, especially holiday areas with a high number of second homes. In some of those areas prices may still have “room to fall,” said Corredor.