That Spain ranks one of the world’s favourite places to buy property is no secret. The country stands as the top destination for foreigners year after year.
Despite the economic and social effects of the pandemic and Brexit, Spanish continues as a preferred holiday home location for international buyers, particularly Northern Europeans. In this article, we look at who buys in Spain, where and what they buy as well as some general facts about the Spanish property market.
How many foreigners buy property in Spain?
International buyers have accounted for around 13% of the Spanish property market every year since 2014. According to figures published by the Spanish Registry Association (Colegio de Registradores), the highest number of properties bought by foreigners was 61,000 in 2017.
In 2020, restrictions on mobility meant that the foreign market in Spain was smaller than usual. However, in Q3, foreigners still accounted for 11.39% of all purchases in Spain. In popular coastal areas and on the islands, foreign buyers represent a considerably higher share. In the Balearics and Canaries, for example, the share was 27.14% and 26.33% respectively. https://www.registradores.org/documents/33383/321222/ERI_2020_3T.pdf/e0a2a7a7-bb8b-bed9-b6d7-24490c16b698?t=1605257841835
At the provincial level, the percentages are higher still. In Q3 2020, the foreign market accounted for 38.14% of the total in Alicante (Costa Blanca) and for 30.25% in Malaga (Costa del Sol).
Who buys property in Spain?
Although Spanish property sparks interest among South-American and Asian buyers, Northern Europeans dominate the market, particularly for second homes on the coast. British buyers have taken the lion’s share for years. And despite Brexit, they continue to do so. In Q3 2020 (latest figures available), they represented 13.01% of the total. The next largest group was the French (8.98%), followed by the Germans and Belgians (both with 8.28%).
European buyers tend to be between 45 and 55 years old, looking for a second home, possibly for retirement. Their average budget is €250,000 and preferred location, on the Mediterranean or in the Canaries.
Where do they buy property in Spain?
While corporate and investor buyers tend to concentrate on Spanish cities, particularly Madrid and Barcelona, lifestyle buyers overwhelmingly prefer the coast. Market analysts noted in 2020 that most interest was centred on the Canaries and Balearics, the Costa del Sol in its entirety (from Sotogrande to Nerja) and the north of the Costa Blanca. Check our Costa del Sol Area Guide for more information about the region.
All these areas have experienced strong price rises since 2014. According to figures published by the property valuations company TINSA, prices for Costa del Sol property generally rose by 3% in the year to Q1 2020 reach an average of €1,684 per square metre. Price hikes in specific resorts were higher, however. For example, property in Benalmádena went up by 8.2%, in Estepona by 8% and Marbella 7%.
What do foreigners buy?
Foreign buyers in Spain tend to buy resale property and favour townhouses with shared pool and garden or villas with a private pool and grounds. Beach and golf locations are the most popular. New-build property plays second fiddle, but since 2016, there has been a marked rise in interest in buying off-plan homes, particularly on the Costa del Sol. For more information on the best projects, please check our New Developments Page.
According to the Architects’ Association in Malaga, 7,102 new-build licences were issued on the Costa del Sol in 2019, slightly down from the 7,678 a year earlier. The majority of new developments are in Malaga city, Estepona, Benahavís and Mijas. In 2020, there were around 200 new developments on the Costa del Sol under construction.
Interest in new-build properties on the Costa del Sol comes both from foreign and Spanish buyers.
How do they find their property?
Most foreigners use the services of a real estate agency. To make things easier, many opt to use an agency with specialist area knowledge, a service that saves time, money and stress and increases the chances of finding the right home.
Let us help you find your perfect second home in Spain. Use our exclusive services to ensure you buy the property that ticks all your boxes. We would love to hear from you.