Housing on the Spanish coast 2024

General Evolution of the Coastal Housing Market

Residential prices in coastal municipalities as a whole registered a quarterly variation of +1.5% and a year-over-year variation of +5.7% in the first quarter of 2024, according to appraisal data from Tinsa España by Accumin. This represents a stronger push for coastal housing prices than the national average, resulting from widespread competition for space on the coast, where the concentration of demand for second homes and vacation rentals competes with local demand for primary homes.

In this environment, new construction, insufficient to meet existing demand, tends to prioritize (more profitable) vacation use, and in the second-hand housing segment, there is a growing convergence of primary and second-home products, which in some areas are becoming substitutes. All of this reduces the available supply of primary homes and hinders access for local demand in some areas. Although their share is a minority compared to domestic buyers for personal use, the increased presence of foreign buyers, buyers who purchase for rental, and professional buyers in the holiday segment is significant. Foreign purchases and sales on the coast approached their highest share to date in 2023, driven by purchases by foreign residents, which have increased their presence over the last decade and even more so in the last two years.

Meanwhile, housing permits in coastal municipalities decreased by 22.9% in 2023, compared to the entire country, where they remained stable. Thus, construction is focused on completing homes already started, with no new projects being added in these areas despite the existing demand, mainly due to obsolete urban development plans and the shortage of available land.

Coastal Property Prices (Primary and Second Homes)

Year-over-year variations in coastal residential prices range from +1.9% on the North Coast to +8.3% on the Canary Islands.

95% of the 257 coastal municipalities analyzed in the report saw an increase in average home values ​​in the last year. The increase exceeded 10% in 26 of them, mostly located in the Balearic Islands, the Canary Islands, Alicante, Malaga, Valencia, Castellón, and Almería. Price drops in the last year were minor (12 municipalities) and moderate (between -0.4% and -2.2%). The municipalities on the Spanish coast with the highest average residential value (€/m2) are located on the island of Ibiza.

Vacation Home Prices on the Coast

The survey of Tinsa's technical network places the average price of vacation homes on the coast at €2,650/m2 during the first quarter of 2024. This price reflects a +3.9% year-over-year increase and represents a slowdown compared to the +6.3% growth recorded in the same period of 2023.

This growth in vacation homes is higher than the +3.3% nationally, but lower than the +5.7% for general coastal homes, which points to increased pressure on the primary residence market in a context of increasingly less differentiated residential products that allow for conversion to vacation homes, whether through purchase or rental.

The highest estimated prices for vacation homes are in the Balearic Islands, certain areas of Girona and Cádiz, and in Málaga and its surrounding areas, in line with high-income demand. At the lower end, with essentially national holiday demand, are Lugo, Pontevedra, and some areas of Almería and Murcia.

No corrections are expected in second-home prices; if they occur at all, they are estimated to be minor and not very significant.