Marbella has been named the most expensive location in the Costa del Sol for property buyers, according to a valuation report by Gesvalt. The city’s average property price is €3,343 per square metre, making it the second most expensive city in Spain for locales with over 50,000 inhabitants.
Costa del Sol’s Property Market Soars
Several other areas within the Costa del Sol are also seeing significant increases in property values. A recent study by Gesvalt highlights that properties in Benalmadena, Estepona, Fuengirola, Mijas, and Torremolinos now average over €2,000 per square metre. This surge reflects a broader trend in the region’s real estate market.
International Buyers Drive Demand
Foreign buyers continue to play a crucial role in the Costa del Sol’s real estate market. In 2023, the Observatorio de Medio Ambiente Urbano (OMAU) reported that international buyers accounted for 34% of the market. This high percentage underscores the strong interest from abroad in Costa del Sol properties.
Market Projections: Growth and Stability
Experts at CaixaBank Research are optimistic about the Spanish real estate market’s future. Lead economist Judit Montoriol predicts the sector will gain strength throughout the year, reaching an expansionary phase by 2025. CaixaBank estimates around 550,000 property transactions in the current year, 40,000 more than previously expected. Despite a projected 7% decrease compared to 2023, prices are anticipated to rebound by an average of 2.7% year-on-year, slightly below the 2023 increase of 1.4%.
Conversely, a BBVA Review indicates that while sales may contract slightly due to persistently high-interest rates, robust labour market performance should keep transactions around 600,000. This figure surpasses the average annual transactions recorded between 2015 and 2018.
Post-Crisis Transformation and Future Outlook
The Spanish property market’s recovery since the Global Financial Crisis (GFC) has been remarkable. The sector has shifted towards stability and discipline, moving away from the excesses that characterized the pre-crisis boom. Positive economic indicators support this transformation: house prices remain 20% below their 2007 peaks, household debt is lower than Germany’s, and predicted GDP growth for 2023-24 outpaces most Eurozone countries.
Despite these strong fundamentals, broader investor sentiment remains cautious, potentially overlooking opportunities within one of Europe’s most reformed property markets. The GFC had a profound impact on Spain, where property prices had soared by 200% in the decade leading up to 2007. The ensuing crash resulted in a prolonged market correction that continues to shape the landscape today.
Learn More
For further information on the Spanish property market trends and expert analysis, you can visit the following resources:
This article highlights the dynamic and evolving real estate market in Costa del Sol, driven by international interest and marked by significant regional price increases.
