Welcome to Pioz: Snowy mountains, castles and a whole lot of debt

(CNN) -- The Spanish town of Pioz boasts views of snow-capped mountains, a 15th-century castle, and a swimming pool for locals to bathe in -- but residents are in short supply.

Pioz has become a ghost town, a haunting reminder of the country's continuing property crisis.

Pioz is saddled with €16 million of debt, making it Spain's most indebted town. Thousands of newly-built homes remain empty and vandalized years after they were built, other projects are simply unfinished and unpaid for.

The town is in the municipality of Guadalajara, just an hour's drive from Madrid, but commuters weren't lured in by the new-build homes. Today, only 3,500 people live in these housing estates designed for 25,000.

The Spanish property boom went bust in 2007, and now 20% of Spanish homes lie empty. The banking sector has €186 billion-worth of troubled real estate assets on its books.

It is easier to grasp the impact of these statistics when standing on a street in Pioz. Row upon row of identical homes stand empty, complete with boarded-up windows, peeling plaster, hanging electrical cables and falling down "For Sale" signs.

Spain's housing boom and bust

At the heart of the town stands an iconic 15th-century castle; despite the ravages of time it appears to be in better shape than many of the newer crumbling homes that surround it.

However, looks can be deceiving. "It's falling down," said ex-Mayor Amelia Rodriguez, "we were thinking of doing some restoration work on it, but owing to the crisis it is not possible. We will leave it until one day when we can."

Elsewhere in the town lie newer constructions: A €1 million community swimming pool that had just one bather on CNN's visit, a €500,000 medical center and a €12 million sewage and water treatment plant, neither of which can be used due to lack of funds for running costs.

According to Juan Yunta, the Director of Public Works in Pioz, the €400,000 toxic waste plant, subsidized by the European Union and Department of Industry, has problems that don't stop at the running costs -- there is a dispute over who actually owns the land.

"Everything has been built on land which doesn't even belong to the town hall," he said. "Fiasco? As far as I know fiasco is when something breaks, like a natural disaster, this is something far greater -- this is utter madness."

Amelia Rodriguez has been the mayor of Pioz for just over a year, but since CNN visited has been ousted from office by the previous mayor Emilio Rincon and six councilors.

She hopes that future town planners and property developers will learn from their mistakes. "As the money came into the town hall, they didn't realize it would ever stop," she said.

"The good times do come to an end. We'll go back to the good times, but for now we must wait. I hope this is a lesson for everyone."

CNN's Anna Stewart contributed to this article