>>513019858
Which is ridiculous because Spain has endless empty land, which could be populated.

Erase any restrictions and regulation on new home building and all of a sudden you'll have not only young Spaniards, but also other Europeans flooding in, building small houses and starting their lives there.

Secondly, credit costs need to go up much higher, because real estate prices are a function of interest rates.
In other words, lower rates increase demand for real estate, which combined with low supply (see previous paragraph), results in this dire housing situation.

When you look at it, Spain just wastes soooo much of its land. They could build the most beautiful housing complexes by the Mediterranean in the hot southern sun.

TL;DR
Day of the rope is needed each day more and more.