At last some good news from the Spanish property market – foreign investment is up strongly on last year.

Foreigners invested 1.3 billion Euros in Q2 this year, up 16pc on the first quarter and 37pc on the same time last year, according to figures from the Bank of Spain.

Foreign investment is still some way (32pc) from the peak it reached in Q2 2003, when it hit 1.9 billion Euros, but there has been a clear improvement in the last 2 quarters, as illustrated by the chart above.

This ties in with what I am hearing on the ground that sales to foreigners have picked up as prices fall, showing how price-sensitive foreign demand for Spanish holiday-homes is. Banks would do well to take this fact on board.

That said, I’m not sure these figures tell the whole story. They look good if you take them at face value, but more research is required to break them down by type of property to draw definite conclusions.

Meanwhile, the news from the domestic market keeps getting worse. Home sales are down yet again, as I will report soon.