257,443 new homes were finished in 2010, down 33pc on the previous year, according to the latest figures from the Government (Fomento).

Construction completions are down 60pc since 2007, when they reached 641,419.

The annual percentage fall in completions roughly mirrors the fall in planning approvals, which hit an all-time low of 91,662 last year. Completions will continue falling until they converge on housing starts, as illustrated in the graph above (completions in red, starts in blue).

And according to Eurostat, the statistics office of the EU, Spanish construction output collapsed 43pc in January compared to the same time last year, against an average decline of 4.5pc in the rest of the EU. The house-building industry is in deep trouble.

But it won’t be long before we start seeing shortages of desirable new homes in good locations, alongside a glut of new homes in bad locations.

That’s what happens when you let a construction boom run wild: banks finance developers building homes nobody wants in areas nobody wants to live in.