Is buying a property in Spain in 2025 a smart investment?

As the year ends, Spain’s housing market is in a strong position. Sales at the end of Q3 showed an 8.7% increase on the previous year. In October 2024, home sales jumped by 51% compared to October 2023, according to the Spanish National Statistics Institute (INE).

It is interesting to note that sales of new properties in Spain are increasing with a growth of 83% for new homes in October 2024 and 43% for second-hand properties.

The following table shows the price per square metre by the autonomous communities of Spain for October 2024:

These figures indicate where you should consider buying property in Spain, depending on your budget and  preferences. When reviewing the best places to live in Spain, remember to also consider your lifestyle, proximity to schools, healthcare facilities, leisure activities and whether you want to live in a traditional Spanish community or near other expatriates.

One of the leading Spanish banks, Caixabank, predicts property prices in Spain will continue to rise by up to 2.8% in 2025. This is partly due to a shortage in housing stock as the population is growing and more people are moving to Spain or relocating.

The population increased by 82,346 people in the first quarter of 2024, reaching a total of 48,692,804 residents up to April 2024. This represents the highest population figure recorded to date.

During the first quarter, the number of foreign residents in Spain increased by 85,684, bringing the total to 6,581,028. Meanwhile, the population of Spanish nationals decreased by 3,338. The estimated population has increased by 459,615 over the year. This growth is almost entirely due to the rise in the number of immigrants moving to Spain.

With demand on the rise, property prices are expected to continue climbing. 2025 is an excellent time to purchase your dream home in Spain, before prices rise further.

The table below shows average property prices in Spain compared to the UK (December 2024):

In addition to economic factors, the increase in foreign nationality residents in Spain also influences property prices, making now a great time to buy!

The rise in population, especially among foreign residents, has led to higher demand for rental and purchased properties, particularly in urban and coastal areas. If you’re considering buying a property in Spain in 2025, this means there are many opportunities to rent it out, either to long-term tenants or as a seasonal rental.

The key tourist and expatriate areas, such as coastal locations and cities like Madrid and Barcelona are anticipated to experience heavy competition in the property market.
Regions with less population growth might still have more affordable property options, allowing you to purchase a bargain in Spain.

A larger population base can stimulate economic activity, as predicted by the European Commission. While the GDP is not expected to grow as much as in 2024, an increase of 2.3% is expected in 2025.

As unemployment and inflation decrease, the cost of living will become more affordable, making Spain an even more attractive investment destination. In fact, Spain’s cost of living is already 26% lower than in the UK.

With increases in demand for new properties already being experienced, more funding may be allocated to new builds. This could lead to developers increasing the number of new housing projects to meet the growing demand, offering more properties to choose from.

The pace of population growth in Spain may increase shortages in the property market, further driving up prices. This can already be seen in the high prices of rental properties throughout the country.

The growing population and rising demand for properties in Spain are putting additional pressure on the housing supply, which could drive prices even higher. Rental properties are already experiencing increased prices across the country, making it a smart move for investors to purchase property now before prices rise further.

With predicted price increases and a thriving property market, 2025 is an ideal time to buy property in Spain.

If you’re ready to make Spain your new home or investment destination, our iad Overseas agents are here to help.

We offer a wide range of properties, from villas with pools on the coast to modern apartments in the city and charming countryside retreats. Contact us today to start your property-buying journey in Spain!

Whether you’re looking for a sunny villa on the coast, a modern apartment in the city, or a peaceful countryside retreat, there’s never been a better time to invest in Spanish real estate.

3 key points to remember

• Property prices in Spain are expected to rise 4% in 2025, presenting a good buying opportunity.
• Spain’s lower cost of living (26% cheaper than the UK) and improving economy enhance its investment appeal.
• Increased foreign immigration is driving demand and rental opportunities, especially in urban and coastal areas.