After crawling back towards positive ground over the last year and a half, Spanish house prices have started trending down again, according to the official House Price Index published by the Government (Fomento).

In nominal terms, prices declined 5.2pc over 12 months to the end of June, to 1,752 €/m2 (red line in the graph above).

In real terms, after adjusting for inflation, prices were down 8.4pc over 12 months (blue line).

Prices fell the most in Murcia (-8.4pc), followed by Valencia (-8.2pc), Pontevedra (-7.9pc) and Girona, home to the Costa Brava (-7.9pc).

Over a decade prices are still in positive territory, but peak-to-present prices are down by more than 23pc in Alicante and Murcia, both regions with a large stock of holiday-homes.

Official? Yes. Accurate? No

The official House Price Index hides as much as it reveals. Peak-to-present, the price of your average holiday home is down by more than 30pc, with plenty of examples to be found of falls of more than 50pc.

The index is based on valuations by certified appraisal companies, rather than transactions, which helps explain why it is never very accurate. 98,000 valuations were used in the latest index, compared to close to 300,000 in Q2 2006, as is illustrated by the following chart.

Fewer transactions and lower prices mean the market is rapidly declining in value – taking with it all those tax revenues that fed the Spanish state during the boom years.