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The Spanish real estate market continues to show strong momentum in 2026, and this is particularly evident in Andalusia. Recent data from the INE (National Institute of Statistics), Idealista and mortgage statistics all indicate stable demand, rising prices and a market driven by genuine buyers rather than speculation. Spain is short of 800,000 housing units, mortgage rates are relatively low, and the supply is healthy.
Are Property Prices Still Rising in Spain? Latest 2026 Data Explained
The latest figures confirm that property prices in Spain are rising quite strongly. As of February 2026, the average price was €2,673 per m², marking a year-on-year increase of 17.7%. Short-term growth remains positive too, at +0.9% month-on-month and +2.6% over the last three months.
Focusing on Andalucía specifically, the long-term housing price index shows prices rising from around 100 in 2015 to almost 186 in 2025 — a substantial increase. This is not a temporary trend — it is a steady upward movement over nearly a decade.
From a lifestyle perspective, this makes sense. People are choosing Spain not just for investment purposes, but also for its high quality of life. Even in winter, cafés are full, beaches are busy and daily life continues outdoors. This constant demand naturally supports prices.
Key Fundamental Factors of The Spanish Property Market in 2026
Foreign Demand
The foreign population in Andalusia has shown strong, long-term growth, rising from approximately 100,000 in the late 1998 to over 747,000 in 2022. The largest expansion occurred between 2003 and 2012, followed by a decline during the financial crisis and a steady recovery since 2017, reaching new heights.
European nationalities dominate the market, accounting for over 342,000 residents. Key groups include Italians (26,328), Germans (16,829), and French (14,277). There is also a strong and growing presence from Africa, particularly Morocco (163,585) and Senegal (15,942), as well as from Latin America, with significant numbers of people from Colombia (25,795) and Argentina (15,232).
*Please note that the recent data from INE (Instituto Nacional de Estadística) is from 2022.
This distribution highlights Andalusia’s enduring appeal and ability to attract a foreign population totaling around 741,000. The blend of European lifestyle buyers and growing demand from emerging markets solidifies the Costa del Sol’s standing as a premier destination for retirees, second-home owners, and international property investors.
Mortgage Activity Spain (2003–2025)
The mortgage market in Spain between 2003 and 2025 underwent a full cycle, shaped by economic events and recovery. Mortgage approvals peaked during the pre-2008 boom, after which lending activity dropped significantly following the financial crisis.
From around 2014 onwards, however, the market gradually recovered, supported by low interest rates and improving economic conditions. Despite rising interest rates in 2022–23, mortgage activity remained relatively resilient in recent years, with new lending increasing by over 10% annually in 2025 and total loan volumes growing even faster. This suggests that demand for property in Spain remains strong, with buyers continuing to access financing even in an environment of higher rates.
Property Transactions Andalucía (2007–2025)
Property transactions in Andalucía show a clear cycle when we look at the numbers between 2007 and 2025. Before the financial crisis, transactions were at their peak, with over 167,800 property sales annually in Andalucía around 2007.
After the crisis, activity dropped significantly, falling to roughly 60,000–62,000 transactions per year between 2012 and 2014. From 2015 onwards, the market began to recover steadily, supported by foreign demand and improving economic conditions.
In recent years, the numbers have become particularly strong again. By 2022–2023, Andalucía was recording around 117,969–134,647 property transactions a year, and this figure remained stable in 2025 despite higher interest rates, with 143,794 transactions being recorded.
This means the region is now operating close to pre-crisis levels, but with a more balanced and sustainable demand profile. In areas like the Costa del Sol, this demand is even more visible, with international buyers playing a key role in keeping transaction volumes high.
The Latest Report From Banco de España
The latest report from the Bank of Spain confirms robust growth in prices, demand and financing in the Spanish property market. Housing prices have risen significantly, with the Housing Price Index increasing by 12.7% in 2025 compared to 8.4% in 2024 and 4.0% in 2023. Second-hand properties led this growth, with an annual increase of +12.9%, while new builds increased by +11.3%. Meanwhile, the average price per square meter rose to €2,128 in 2025, up from €1,914 in 2024 and €1,809 in 2023.
In terms of supply, construction is increasing but remains limited. Approximately 139,000 new homes were approved (visados) and around 140,000 homes were started in 2025. Demand remains strong, with around 752,000 property transactions in 2025 compared to 716,000 in 2024.
Mortgage conditions are also improving, with average interest rates dropping to around 2.7% in early 2026 and loan-to-value ratios rising to around 64.8%, indicating increased lending confidence. Meanwhile, the number of households in Spain continues to grow, reaching 19.85 million, which reinforces the long-term demand for housing.
Spain’s housing market has grown significantly over the past few decades, but what matters is how this growth compares to actual demand. The total number of homes increased from 10.6 million in 1970 to 26.6 million in 2021, demonstrating robust long-term growth. However, the number of homes per household has remained relatively stable, fluctuating slightly from around 1.45 between 1981 and 1991, peaking at 1.52 in 2001, before settling at 1.41 in 2021.
This suggests that, despite the substantial increase in construction, the actual surplus of housing is quite limited. Put simply, Spain has built more homes, but the rate of household formation has kept pace, which helps to explain why property prices continue to rise, especially in high-demand areas such as the Costa del Sol, where the available supply is often tighter than the figures suggest.
Conclusion
Overall, Spain’s property market is characterised by strong demand and limited effective supply, despite the large amount of housing stock on paper. This continues to drive up property prices and maintain stable market activity, particularly in popular regions such as Andalucía.
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