In 2024, Spain witnessed an unprecedented surge in home purchases by foreign buyers, with nearly 93,000 transactions recorded, marking a historic high for the country. According to quarterly data from the Registrars, compiled by idealista/news, foreign buyers accounted for 14.6% of the total 636,909 property sales, reflecting a 9.2% increase from the previous year.
The regions most favored by foreign buyers include the Balearic Islands, the Valencian Community, and the Canary Islands, where more than one in four purchases were made by non-residents. Specifically, in the Balearic Islands, 32.6% of transactions involved foreign buyers, while the Valencian Community saw 28.9% and the Canary Islands 27.2%.
Among the nationalities leading the charge in property acquisitions were British, German, and Moroccan citizens, with British buyers recording nearly 8,000 purchases. German buyers followed closely with over 6,100 transactions. The increase in foreign purchases is attributed to the overall growth in the Spanish real estate market, which saw 505,145 sales of existing homes and 131,764 sales of new homes, representing year-on-year increases of 6.4% and 21.6%, respectively.
The Valencian Community emerged as the top destination for foreign buyers, with over 29,900 transactions, accounting for 32.2% of all foreign purchases in Spain. Andalusia and Catalonia also saw significant foreign interest, with 17,435 and 16,053 transactions, respectively. The Region of Murcia recorded 23% of all transactions involving foreign buyers, while the Community of Madrid accounted for 7%, surpassing the Balearic Islands in total transactions.
At the provincial level, Alicante stood out with more than 22,700 transactions by foreign buyers, representing 43.8% of total sales in the province. Málaga also saw substantial foreign activity, with over 11,400 properties purchased, making up 32.4% of all sales on the Costa del Sol.
Interestingly, the report indicates that while British and German buyers remain dominant, there has been a notable increase in purchases by citizens from Morocco, the Netherlands, Romania, and Poland. In contrast, French buyers have seen a decline, falling below 5,000 transactions.
In addition to the surge in foreign home purchases, the Spanish housing market is experiencing significant price fluctuations. House prices have surged since mid-last year, with the Balearic Islands and the Community of Madrid seeing the highest increases at 12.1% and 9.4%, respectively. These regions have average prices exceeding €3,000 per square meter, creating a widening gap between municipalities.
Sales growth is particularly pronounced in the cooler regions of Northwest Spain, where areas like Galicia and Asturias have reported increases of 22.3% and 18.6%, respectively. This trend indicates a shift in demand from traditional tourist hotspots to more affordable regions.
As prices rise in major cities, demand is beginning to shift toward peripheral areas, where home prices are expected to grow rapidly in 2025. The report highlights that 47.1% of municipalities registered a year-on-year increase exceeding 10% in Q4 2024, reflecting a robust recovery in the housing market.
However, the rising prices have led to concerns about affordability, particularly for locals. The sharp increase in housing costs has prompted calls for increased affordable housing supply to address the growing residential exclusion.
Moreover, Spain is set to end its Golden Visa program next week, which had allowed non-EU citizens to gain residency in exchange for purchasing property valued at over €500,000. This change is expected to impact foreign investment in the Spanish real estate market.
As Spain closes this chapter, Portugal has reported a massive increase in interest for its own visa programs, attracting those who may have considered Spain as their destination. The contrasting policies between the two countries could reshape the dynamics of foreign investment in the Iberian Peninsula.
In summary, the Spanish housing market is experiencing a dual trend of increasing foreign investment and rising prices, while also facing challenges in affordability and accessibility for local residents. As the landscape evolves, stakeholders are urged to consider the implications of these changes on both the domestic and international fronts.
