The Price of Housing in Spain in 2024: A New All-Time Record

The Spanish real estate market has experienced unprecedented growth in 2024, reaching price levels never seen before. With an annual increase of 12.5%, the average property value in Spain has surpassed the historic highs recorded in 2007. This phenomenon is driven by multiple factors, including strong domestic and foreign demand and a limited supply in key regions. In this detailed analysis, we examine the reasons behind this growth, the most affected regions, and forecasts for the near future.

Housing Price Evolution in Spain in 2024

According to the College of Property Registrars, the average price per square meter in Spain has reached €2,164/m², reinforcing an upward trend that has continued for five consecutive quarters. This growth has been fueled by several key factors:

• Strong national and international demand
• Limited supply in major cities and coastal areas
• Tax incentives for property purchases
• Macroeconomic stability and job market recovery

In terms of property types, new developments have outperformed the secondary market, with a 3.7% quarterly increase, compared to 1.6% for resale properties.

Regions with the Highest Property Prices

Property price increases have not been uniform across Spain. Some regions have experienced a much sharper rise, particularly those with high demand and limited availability of developable land.

Average Property Prices by Region (€ per m²):

• Madrid: €3,780
• Balearic Islands: €3,771
• Basque Country: €3,157
• Catalonia: €2,615
• Canary Islands: €2,327

At the provincial level, Madrid, the Balearic Islands, and Gipuzkoa lead as the most expensive markets. Among cities, the highest property prices have been recorded in:

• San Sebastián: €5,708/m²
• Madrid: €4,517/m²
• Barcelona: €4,483/m²
• Palma de Mallorca: €3,631/m²
• Bilbao: €3,068/m²

Increase in Transactions and Market Dynamics

The real estate market has shown remarkable stability in 2024, with 636,909 property transactions, representing a 9.2% increase compared to the previous year. This growth has been mainly driven by:

• Higher demand for resale properties (+6.4%)
• Strong growth in new property sales (+21.6%)
• Increased interest from foreign buyers, particularly in coastal and island regions

The last quarter of the year has been the most dynamic since 2007, with 172,551 transactions, confirming the sector’s full recovery after the pandemic.

Foreign Investment in the Spanish Real Estate Market

International buyers have played a crucial role in driving up property prices in Spain. In the last quarter of 2024, they accounted for 14.48% of all property transactions, purchasing more than 25,000 homes.

Top Nationalities Purchasing Property in Spain:

• British: 8.57%
• Germans: 6.67%
• Dutch: 5.91%
• Moroccans: 5.30%
• French: 5.28%
• Romanians: 5.17%
• Italians: 4.76%

Most Popular Regions for Foreign Investors:

Mortgages: Growth in Bank Financing

A significant 70% of property transactions in 2024 were financed through a mortgage, highlighting the importance of bank credit in the real estate sector. In the last quarter, 123,897 mortgage agreements were signed, marking a 13.4% quarterly increase.

Regions with the Highest Number of Mortgages Issued:

• Andalusia: 24,543
• Catalonia: 20,811
• Madrid: 20,027
• Valencian Community: 14,422

Despite global economic uncertainty, the Spanish mortgage market has remained stable due to moderate interest rates and favorable financing conditions.

Investment Tips for 2025

To maximize returns in 2025, investors should consider the following strategies:

✅ Prioritize high-demand areas with limited supply, such as Costa Blanca, and the Costa del Sol.
✅ Invest in tourist rentals or long-term rental properties, as demand continues to grow.
✅ Look for opportunities in the secondary market, where properties with potential value appreciation can still be found.
✅ Negotiate favorable mortgage terms, as interest rates remain relatively competitive.
✅ Monitor government housing policies, as they may impact taxation and overall investment profitability.

Conclusion and Forecasts for 2025

Projections for 2025 suggest a moderation in price growth, although the upward trend could continue in areas with strong demand and limited supply. Key factors that will influence the market include:

• Interest rate developments and the European Central Bank’s monetary policy
• The impact of new housing regulations and government measures
• Economic stability and consumer confidence
• The attractiveness of the Spanish market for foreign investment

The Spanish real estate market remains an attractive destination for investors and buyers, solidifying its stability and sustained growth in the near future.