According to the Real Estate Barometer published by UCI and SIRA, Spain's housing market in 2025 will face contradictory trends. On the one hand, the number of purchase-sale transactions is projected to increase by 4.61% year-on-year, reaching 750,000 transactions nationwide. On the other hand, price pressures will persist: the average rise in housing prices will be 10%, while rental rates will increase by 8.6%. These trends will vary regionally, with the leaders being Murcia (+15%), Valencia (+12.4%), as well as Galicia, Andalusia, and Catalonia (10% each).
In Catalonia, particularly Barcelona, purchase prices will rise by 10.06%, and rental prices by 4.57%. As explained by SIRA Director Francis Fernández, the key drivers are:
- Lower interest rates, improving the accessibility of mortgage lending.
- Growth in the number of households, including an influx of foreign buyers (emigrants and expatriates) choosing the region for permanent residency.
Chronic supply shortages, caused by a lack of land for development, bureaucratic barriers, and lengthy approval processes for new projects.
Barcelona, while maintaining its status as a prestigious destination, faces unique challenges. High demand for housing contrasts with nearly zero growth in new construction. This creates a vicious cycle: limited supply intensifies price pressures, while administrative complexities block efforts to increase housing volumes.
Rental Market Crisis: Causes and Consequences
A decline in rental transactions is expected: 7.3% in Spain and 9% in Catalonia. Key factors include:
1. Mass transition of property owners from long-term to short-term (tourist) rentals, which are more profitable under price regulations.
2. Legal risks. Laws limiting rent increases in "high-pressure zones" force owners to withdraw properties from the market.
3. Reduction in available housing stock. Experts estimate that up to 20% of housing in Catalonia has been repurposed for Airbnb.
Despite the decline in transactions, rental prices will continue to rise due to imbalance: demand for affordable housing in major cities exceeds supply by 3-4 times.
Strategies to Address Affordable Housing
The sector’s main challenge is ensuring social and affordable housing in high-demand areas. Proposed measures include:
- Public-private partnership (PPP) projects. Joint programs between the state and developers to build economy-class housing with preferential financing.
- Revision of urban planning regulations. Simplifying procedures for allocating land for social housing and shortening permit approval times.
- Renovation incentives. Tax breaks for investors renovating buildings with a mandatory 30% quota for social housing.
- Support for first-time buyers. Subsidized mortgage rates and government guarantees for young families.
Spain’s real estate market in 2025 will remain a field of contradictions: rising transactions amid price growth, attempts to regulate rentals, and worsening affordability. Success in overcoming the crisis will depend on coordinated actions by authorities, businesses, and society to increase supply and balance the interests of all market participants.