Spanish property market - 2025 Q2 Review: Continued resilience and growth
Friday, August 1, 2025 @ 8:58 PM
Building on the Q1 2025 review, the Spanish property market has continued to demonstrate remarkable resilience and dynamic shifts throughout the second quarter of 2025. The average value of completed properties, encompassing both new builds and resales, recorded a substantial year-on-year increase of 9.8% and a quarter-on-quarter increase of 2.6% with a real annual growth of 7.7% when adjusted for inflation.
This sustained strength is underpinned by a compelling interplay of economic factors, including resilient employment and robust demand, significantly influenced by easing mortgage costs following the European Central Bank's 25-basis-point reduction in key interest rates. This widespread growth throughout the first half of the year underscores the broad-based strength of the market.
Q2 year-on-year price changes in Spanish property across all autonomous communities. Source Tinsa.
At the regional level, the momentum was particularly evident, with year-on-year growth accelerating or remaining high in 16 of Spain's 19 autonomous regions. Four regions stood out with exceptional growth exceeding 10%: Madrid led with a 16.1% increase, followed by the Balearic Islands at 14.4%, Cantabria at 14.1%, and Asturias at 11.6%. Notably, the Balearic Islands (25.3%) and Madrid (6.8%) have now surpassed their 2007 property bubble peaks in nominal terms, though they remain below their inflation-adjusted peaks (9% below in the Balearics and 24% below in Madrid, considering CPI at 2.3% in June 2025). The "Madrid effect" is also creating a ripple effect, activating prices in surrounding provinces like Toledo, Segovia, Guadalajara, and Ávila as buyers seek more accessible options.
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