The biggest problem is on the Mediterranean coast, where too many holiday-homes were built with foreign buyers in mind during the boom.
The map above illustrates the size and location of the Spanish property overhang of newly-built homes.
Based on figures from the Department of Housing for the end of 2011, the map is a bit out of date, but the problem today is just as big. Sales to foreigners increased in 2012, but so did the number of finished homes, so the net result was likely to be have been little or no change to stock levels.
To sort out this problem of the glut, which is weighing down the market, Spain still has to sell a lot of new homes in Andalusia (Costa del Sol), Valencia (Costa Blanca), and Catalonia (Costas Dorada & Brava). This is the problem that the so-called “bad bank” will have to help solve.