Property News from Spain

The Balearic Islands have once again affirmed their position as the priciest province in Spain for purchasing residential property, with average prices for second-hand homes consistently exceeding the €5,000 per square metre mark.

According to data for August 2025, the archipelago remains highly coveted by both domestic and international buyers, driving the average cost of properties to unprecedented levels. The islands recorded an impressive 12.3% annual price increase, slightly below the national average but reflecting a relentless surge in demand that continues to push local real estate records.

Record Prices in Palma and Across the Archipelago

The capital city, Palma de Mallorca, has been a significant driver of this growth, experiencing a substantial 17.2% annual increase. This spike has pushed the average price for a second-hand home in Palma to €5,006/m², firmly placing it among the most expensive cities in the country.

Overall, the high demand has resulted in record prices being reached in 25 municipalities across Mallorca, Ibiza, and Menorca. However, the most exclusive markets are found primarily on the island of Ibiza.

Ibiza Dominates the Top Tier

The most expensive municipality in the entire province is Sant Joan de Labritja in Ibiza, where the average price per square metre now stands at a staggering €8,959. This area, along with others on the island, constitutes the pinnacle of Spanish luxury real estate.

The top five most expensive locations are:

1. Sant Joan de Labritja (€8,959/m² | +13.0% annual change)

2. Sant Josep de Sa Talaia (€7,367/m² | +6.4% annual change)

3. Sant Antoni de Portmany (€6,927/m² | +19.6% annual change)

4. Calvià (Mallorca) (€6,925/m² | +8.7% annual change)

5. Ibiza Town (€6,879/m² | +3.0% annual change)

Surge in Dynamic Growth Areas

While the established hotspots maintain their high values, several municipalities are experiencing explosive price appreciation. Colonia de Sant Pere saw the most dramatic annual rise, with prices skyrocketing by 37.5%. Other areas showing dynamic market growth include Felanitx (+30.2%), Inca (+26.4%), and Muro (+23.1%).

Noteworthy growth was also recorded in Sant Antoni de Portmany, which experienced the sharpest increase among the top five most expensive locales at 19.6%.

For foreign investors and expatriates, these figures underscore the premium nature and dynamic market conditions of the Balearic Islands. With prices climbing rapidly across Mallorca, Ibiza, and Menorca, the region continues to offer a compelling mix of luxury living, Mediterranean lifestyle, and solid, high-yield investment potential. Prospective buyers should be prepared for a competitive market environment in Spain's most desirable island province.

Buying a brand-new property in Spain is an exciting prospect, but like any new construction, unexpected issues—from minor finishing defects to serious structural faults—can sometimes arise. Fortunately, Spain’s legal framework provides comprehensive protection for new homeowners through the mandatory new-build warranty, governed by the Building Regulations Act (LOE).

Understanding the duration and scope of this guarantee is crucial for any new homeowner. Here is a breakdown of what the Spanish new-build warranty covers and the deadlines for making a claim.

The Three Tiers of Warranty Coverage

The length of the warranty period in Spain is determined by the severity and type of defect, with all periods starting from the date the construction company officially delivers the work (not the date the property is purchased).

Crucial Point: Homeowners have an additional claim period. Regardless of the time left on the above warranties, buyers have up to two years from the moment they discover a defect to officially request its repair.

Making a Claim: Process and Best Practices
If you discover a defect, you must make a claim against the developer or any other party involved in the construction.

1. Establish Causation
A claim is only valid if there is a clear causation linking the defect directly to the construction process. A crack appearing in a pillar within the first few years is clearly attributable to construction, whereas the same issue appearing after several decades may be difficult to prove and more likely attributed to inadequate maintenance.

2. Notify the Developer
It is strongly advised to report these defects using a method that provides a reliable, verifiable record, such as a burofax (a certified communication service in Spain). This document serves as indispensable evidence should the issue escalate and require legal action.

3. Know Your Legal Deadlines
While the two-year period to act after discovering a defect is key, you must be careful with timing. If you send a burofax reporting a defect within the first year but fail to initiate legal action within two years of discovery, your right to claim for that specific defect is lost. You can, however, still make claims for any issues that arise subsequently.

Responsibility and Common Areas

Who is Responsible for the Repairs?
Responsibility is shared among all agents involved in the building process, including:

• The developer (promoter)
• The construction company
• Architects and surveyors
• Finishing contractors

While the developer typically assumes the bulk of the initial repair costs, they reserve the right to seek recovery from the specific agent (e.g., the plumber or architect) found responsible for the faulty work.

Dealing with Defects in Common Areas
If the damage is found in common areas (such as the facade, roof, community gardens, or shared electrical systems), the Community President or the Property Manager is responsible. Their role is to compile a comprehensive list of all defects and officially request rectification from the developer on behalf of the entire community.

The Developer's Claim Process

Developers usually have a streamlined process for handling new-build defect claims:

• Reception and Analysis: The developer receives and reviews the official claim.
• Technical Inspection: A technician is dispatched to the property to assess and verify the reported defects.
• Detailed Report: The technician prepares a full report documenting the condition and cause of the defects.
• Evaluation and Resolution: The developer decides whether to accept or reject the claim. If accepted, repairs are scheduled. If rejected, the homeowner or community may need to pursue legal action.

While legal proceedings can be lengthy and involve extra costs (solicitor’s fees, expert reports), a ruling in your favour will require the developer to cover the legal costs and carry out the necessary repairs.

Ultimately, the Spanish new-build warranty provides a robust safety net, giving buyers peace of mind and clear timeframes for ensuring their new investment meets the required standards of quality and safety.

This guide will give you a comprehensive overview of living in the vibrant province of Málaga, a true gem of Andalucía and home to the famous Costa del Sol. Whether you're a remote worker seeking sun and a new environment, a family looking for a new life, or a retiree, this guide will provide essential information for anyone considering moving to this part of Spain.

Best places to live on the Costa del Sol

The province of Málaga is a diverse area, with the bustling city of Málaga at its heart and the world-renowned Costa del Sol stretching along its coastline. The Costa del Sol is home to many popular towns and villages, each offering a unique lifestyle.

• Málaga City: The city of Málaga is a vibrant and culturally rich hub, often referred to as the "Silicon Valley of the Costa del Sol" due to its thriving tech and startup scene. The historic centre is a must-see, and the city boasts a modern port and a beautiful urban beach, Malagueta beach.
• Marbella: Known for its luxury, Marbella is a top destination on the Costa del Sol. It offers a glamorous lifestyle with high-end restaurants, boutiques, and exclusive beach clubs. It's a popular choice for expats seeking an upscale life.
• Estepona & Fuengirola: These coastal towns offer a more traditional Spanish feel while still catering to an international crowd. They have beautiful beaches and a lively atmosphere, and are popular choices for families and those looking for a more relaxed coastal life.
• Nerja: Located at the eastern end of the Costa del Sol, Nerja is famous for its "Balcón de Europa" viewpoint and the stunning Nerja Caves. It's a picturesque town that offers a perfect balance of natural beauty and cultural richness.
• Inland villages: The province also has charming white-washed villages in the mountains, such as Mijas, Ronda, and Frigiliana. These areas offer a peaceful, traditional Andalusian life away from the hustle and bustle of the coast.
• Other Notable Areas: Other areas worth considering include Soho, Málaga's art district known for street art, and Teatinos, the modern university district popular with young professionals and students. La Malagueta is a prime beach district, while El Perchel is an older, working-class district known for its fresh seafood.

For a more detailed breakdown of the different towns and cities, check out our article on The best areas in Costa del Sol for expats.

Population and popular expat areas

Málaga province is a very popular destination for expats, with a large and well-established international community. You'll find a significant number of English and German-speaking expat residents, particularly in areas like Marbella, Mijas, and Fuengirola. This makes the transition to a new life in Spain a bit easier, as many services are available in English. This is also a huge benefit when it comes to social life, as it's easy to connect with other expats and find community. Málaga's expat population includes a high number of British and German nationals as well as many others, and the overall population of the city is around 587,000.

As of July 1, 2025, the population of Malaga province stands at 1,798,265 inhabitants, making it the sixth most populous province in Spain. The province has experienced significant growth, adding 14,451 residents over the past year, with a notable increase of 4,155 people in the first quarter of 2025 alone. This growth is primarily driven by foreign migration, as the number of foreign-born individuals now represents 24.3% of the total population, a figure well above the national average.

Read more at thinkSPAIN.com

The Spanish government has announced a new State Housing Plan for 2026-2030, a comprehensive set of measures designed to tackle the country's ongoing housing crisis. The centerpiece of this plan is a new aid package of up to €30,000 for young people under the age of 35, aimed at helping them get on the housing ladder through a rent-to-buy scheme.

Rent-to-Buy and Anti-Speculation Measures

This flagship initiative allows monthly rent payments to be counted as an advance towards the eventual purchase of a home. The aid will be applied to properties designated as "permanently protected" housing. This critical detail means their price is capped and cannot be freely set by the seller at market rate. If the property is resold in the future, it must be at a regulated price and only to another person who meets the same eligibility requirements. This is intended to protect state-funded housing from market speculation and ensure its long-term affordability.

Broader Housing Initiatives

In addition to the rent-to-buy scheme, the plan introduces several other key initiatives:

• Rental Default Insurance: The government will act as a guarantor for young tenants, which is designed to provide security for landlords and make them more willing to rent their properties to young people. This insurance will cover monthly payments that do not exceed 50% of the tenant's net income.

• Rural Home Purchase Grants: To combat depopulation in less-populated areas, the plan offers grants of up to €10,800 for young people who purchase homes in municipalities with fewer than 10,000 inhabitants. This grant can cover up to 20% of the property's purchase price.

• Increased Regional Funding: The central government has pledged to triple its housing budget transfers to regional authorities. The catch is that regions must also commit to promoting social housing to receive this funding. This could lead to a combined investment of €7 billion over the next five years.

Political Context and Criticism

Prime Minister Pedro Sánchez announced these measures as a direct and firm step forward in housing policy, aimed at making it easier for young people to achieve financial independence and access affordable housing. However, the plan has faced some criticism. Second Deputy PM and Minister of Labour, Yolanda Díaz, has argued that focusing on rental assistance is not the most effective approach, as it could simply transfer funds into landlords' pockets rather than directly addressing the root cause of high prices. She contends that the more urgent need is to lower rental prices across the board.

Who cleans the stairs in your apartment block or maintains the communal pool on an urbanisation in Spain? Who pays for it, and how much? It might not have occurred to you that someone has to do these things. Or maybe you've heard of the concept of a comunidad de propietarios ('community of owners') and how it's responsible for these and other maintenance issues, but are not sure how it works.

Briefly, anyone who owns a property that involves space or facilities shared with other owners will need to take into account 'community fees', or gastos de comunidad, when budgeting for household expenses. Only the owner, never the tenant, pays these – although a landlord may factor in the cost when setting rent charges.

It's in your best interests to know how these fees are calculated, what they cover, who gets to decide everything, and the legal framework covering it all – including your own rights and duties.

What is a comunidad de propietarios (community of owners)?

A comunidad is run by, and for, owners of homes or businesses, to cover the costs of maintaining and repairing any communal (shared) features, and the addition of new features.

A community of owners is a legal entity and has legal personality, its actions are covered by legislation, and the percentage of costs you pay as regular and extraordinary fees are stated in the deeds to your property.

Depending upon your country of origin, you may have a similar system in place: A copropriété, in France; condomínio in Portugal; a condominium or homeowners' association (HOA) in the USA or Canada, and a freehold or a commonhold in the UK.

A comunidad de propietarios is not quite the same as a freehold, though, as we'll explain below.

Creating a comunidad de propietarios is required by law on urbanisations or in apartment blocks with five or more owners and five or more properties. Multiple owners of a single property, or an individual owner of several properties, count as one owner.

Read more at thinkSPAIN.com

Relocating to Spain offers an enriching lifestyle and new opportunities, but careful financial planning is essential to making the most of your move. As an expat, understanding how residency status, tax obligations, and managing foreign income will impact your finances can help you build a stable foundation. This guide provides an overview of the basics you’ll need to know, from determining your residency status and visa type to handling taxes on income earned abroad.

Navigating residency and visas

When moving to Spain, choosing the right visa is an important first step. Residency status affects your eligibility for work, the tax you pay, and your access to public services. Below, we explain some basic concepts on this subject.

Visa types for expats in Spain

The visa you need depends on your income and plans in Spain. Here are the main options:

• Non-Lucrative visa: Designed for retirees or those with passive income from outside Spain, this visa allows you to live in Spain but not to work.
• Work visa: Necessary if you plan to work for a Spanish employer or start a business in Spain.
• Other visa types: Spain offers additional options, such as student visas, entrepreneur visas, and family reunification visas for expats joining family members.

For a detailed overview of each visa type, requirements, and application steps, refer to our complete guide to Spanish visas.

Understanding tax residency

Tax residency is determined by where you live and where you have economic ties. In Spain, you’ll generally be considered a tax resident if:

Spain's housing market is experiencing one of its most dynamic periods, with the price of free-market housing surging by a remarkable 12.7% in the second quarter of 2025, according to the National Institute of Statistics (INE). This marks the largest annual increase since the first quarter of 2007 and the second-highest on record.

A Market Driven by Imbalance

Multiple sources and experts point to a fundamental imbalance between supply and demand as the primary driver of this trend. While demand remains robust, the supply of available homes has decreased significantly, with some reports indicating a 20% reduction in homes for sale over the last 12 months. This scarcity is a key factor pushing prices higher.

Key Drivers of the Price Surge:

Chronic Supply Shortages: Spain's construction sector has struggled to keep pace with demand. New housing completions are well below the number of new households being formed, creating a structural deficit of hundreds of thousands of homes. This is due to a combination of factors, including rising construction costs, labor shortages, and extensive bureaucratic processes for building permits.

Strong and Diverse Demand: Demand is coming from various sources, including domestic buyers and a surge in foreign investment. International buyers now account for over 20% of all property transactions nationwide, with some coastal regions seeing foreign buyer participation as high as 40-45%. This is driven by Spain's attractive lifestyle, climate, and perceived affordability relative to other European countries.

Favourable Lending Conditions: The European Central Bank's interest rate cuts throughout 2024 and early 2025 have made mortgages more attractive and increased buyer purchasing power. This has encouraged more people to enter the property market, further stimulating demand.

Regional and Property Type Disparities:

The price increases are widespread, with all autonomous communities showing double-digit annual rates. Hotspots for growth include Murcia, Aragon, La Rioja, Madrid, and the Valencian Community. The price of used homes has seen a steeper rise (12.8%) compared to new homes (12.1%), although new builds are still highly sought after due to their energy efficiency and modern amenities.

Future Outlook and Market Forecasts:

While the market is hot, analysts are not calling it a speculative bubble like the one that preceded the 2008 crash. Instead, they see the current situation as a structural issue of high demand and limited supply. Forecasts for the coming years vary slightly but generally predict continued, albeit moderating, price growth.

Most experts agree that prices will continue to rise by 4% to 9% through the rest of 2025.

For 2026, growth is expected to moderate to around 3-5% as the market stabilises.

The long-term outlook suggests that structural factors like chronic undersupply and demographic trends will continue to exert upward pressure on prices for the foreseeable future.

The search for a home in Spain has become a challenge for many, as the market's strong performance, driven by a powerful mix of economic strength and limited housing stock, shows no signs of slowing down.
 

As a highly sought-after location for a sunshine-filled life overseas, property for sale in Mallorca is usually snapped up very quickly – making it a great investment. This also means the largest of the Balearic Islands is among Spain's most expensive places to buy a home – but did you know that there are still plenty of houses and apartments for sale in Mallorca for under €200,000?

It's true that homes in this price bracket are more limited in number, but they're not as rare as you would think, especially if you don't need much space, or you're able and willing to renovate them.

Low-cost Mallorca holiday homes

Whether you're seeking a sunny retreat for relaxing and unwinding, or a sound long-term investment you can let out to other holidaymakers, you'll find plenty of apartments for sale in Mallorca for under €200,000. Better still, many are near beaches, have access to communal pools, or both.

Studio flats big enough for a single person to live in year-round, or for a couple on extended holidays, are found in popular coastal areas like Palma, Alcúdia, and Manacor beach for between €100,000 and €135,000. With all amenities close by, and the splendid Mediterranean weather, you won't need to spend much time indoors. But these properties are typically modern and stylish, so your comfort's assured on those days when you don't feel like venturing outside.

Everywhere in Mallorca is, at most, a short drive from the beach, but if you're not directly on the coast, your money goes further. Property for sale under €200,000 offers more space in attractive inland towns like Manacor and Inca. Here, two-bedroom flats start from about €140,000.

Affordable Mallorca homes to renovate

Putting your own stamp on a new home can be hugely satisfying and, when it's in a Spanish holiday hotspot, a superb investment. Depending upon how much extra you're able to spend, you can catch a bargain.

Property for sale in Mallorca under €200,000 frequently includes spacious villas in major tourism belts needing refurbishment. They may already have the necessary mains utility systems in place, but require new fixtures and cosmetic upgrades. Upon completion, you'd have a comfortable, high-class home suitable as a family residence, and make a significant resale profit.

Check out our selection below of properties for sale under €200,000 in Mallorca for inspiration.

Deciding on the best place to retire in Spain will depend very much on what you want from your retirement. We understand that with so many great places to live in Spain, this task can be a little overwhelming, which is why we want to help you simplify the process. Choosing the best place to retire in Spain will depend on several factors, such as personal preferences, budget, climate, amenities, and location.

Here are some tips to help you make a well-informed decision:

1. Determine your budget: Spain offers a wide range of retirement options, from luxurious coastal resorts to small inland towns. Determine how much you can afford to spend on housing, healthcare, transportation, and daily living expenses.
2. Consider the climate: Spain has a diverse climate, ranging from Mediterranean in the south to subtropical in the north. Consider your preferences for temperature, humidity, and rainfall when choosing a place to retire.
3. Look for amenities: Make a list of amenities that are important to you, such as healthcare facilities, cultural activities, shopping centres, and restaurants. Look for a place that offers the amenities that you need to enjoy your retirement.
4. Choose a location: Decide whether you want to retire in a coastal town, a city, or a rural area. Coastal towns offer a relaxed lifestyle and easy access to beaches, while cities provide more cultural and entertainment options. Rural areas offer a quieter and more peaceful lifestyle.  

Read more at thinkSPAIN.com

When selling or renting your property in Spain, boosting its market value through renovations can be an excellent investment. Extensive and costly improvements aren't always necessary; small, cost-effective upgrades can make a substantial difference. These enhancements not only increase the sale price but also make the property more appealing to potential tenants or buyers.

By understanding what factors influence property appreciation and strategically implementing effective upgrades, you can achieve a higher profit. Let’s explore some impactful measures and considerations for enhancing your property's value.

1. Kitchen and bathrooms

The kitchen and bathrooms are critical areas that can make or break a sale. They are one of the areas that potential buyers scrutinise. Making it more functional and modern can be a game-changer. Even simple updates like fresh paint and new hardware can make a substantial difference. The cost of a new kitchen can start at approximately €5,000 increasing substantially depending on specifications. If you’re contemplating selling, modernising your existing kitchen often provides a good return, potentially increasing your property's value by about 5%. A renovated bathroom with high-quality fixtures and tiles can increase your property value by 10-20%. A complete bathroom update can range from €10,000 to €20,000. Here are some areas to consider:

• Replacing cabinets: New cabinets can refresh the kitchen’s or bathroom’s look.
• Upgrading countertops: A new worktop can give the kitchen a facelift. For smaller kitchens, white worktops can brighten the area and create a sense of spaciousness. This simple change can modernise your kitchen without a significant expenditure.
• Upgrade taps: Modernising the kitchen taps with more contemporary and practical designs can make a big difference.
• Installing modern appliances: An induction hob or new appliances can update the kitchen.
• Repainting walls: Warm colours can make the kitchen feel more inviting.
• Updating flooring: Changing the floor can modernise the kitchen.
• Swap bathtub for shower tray: A simple and practical upgrade involves replacing the bathtub with a shower tray. This not only saves space but also reduces water consumption, adding both functionality and an eco-friendly appeal.
• Installing a shower screen: instead of a curtain for a modern look.

2. Flooring

Replace old flooring with stylish and durable materials like hardwoods, laminates, or high-quality tiles. If your budget allows, replacing worn parquet flooring can give your home a fresh look. Alternatively, consider refinishing existing flooring.

3. Enhance lighting

Good lighting can exponentially increase the appeal of any living space. Here are ways to let in more natural light:

Read more at thinkSPAIN.com