Andalucia Overseas Property Market Guide

Although Spain’s total property market is vital, Andalucá is an essential portion. As a rule, it accounts for at least 20% of all transactions in the country. It was 22% in 2021. In a typical year, foreign buyers account for around 15% of the market in Andalucia. However, there is no such thing as normal at the moment, and the year 2022 will mark the third year in a row that Covid-19-related disturbance will be felt. Due to travel restrictions between March 2020 and June 2021, many foreign property purchasers were unable to get into the nation and purchase property there. Visitors from the United Kingdom were subject to certain travel restrictions until August 2021. With the closure of borders, domestic purchasers were also unable to move between autonomous areas, provinces and even towns.


In light of this, it’s safe to assume that the Andalucan real estate market will be in trouble by 2022. However, according to current data on foreign purchasers in the first half of 2021, the situation is far from dire. Contrary to expectations, despite the pandemic’s effects, foreigners’ spending is maintaining steady. Price increases have also been observed throughout the epidemic, particularly in the most expensive and sought-after areas.


The Omicron variant’s rapid arrival towards the end of 2021 may impede complete recovery, but I believe the full-year results will be much better, especially if the Omicron-related interruption is short-lived. Indeed, I would go as far as saying that the property market in the abroad sector is not only thriving because of the epidemic, but is really flourishing as a direct result. There has never been a better time to buy or sell property in Andalucia Spain


What Is the Source of These Numbers?

Counts of transactions by nationality, autonomous areas, and prices per square metre are also available from the Notaries. These are released every six months. When do we receive Q1 and Q2? In November of the year in which they’re released, and when do we get Q3 and Q4? Consequently, the whole picture of 2021 will not be available until May 2022. Even so, what we’ve got thus far is encouraging.

In addition, I use data from the Ministry of Development (Ministerio de Fomento) to split down the provinces and municipalities into their respective populations. Foreign purchasers, on the other hand, are counted as a single group.


In general, I won’t be using a lot of 2020 data in this report since I don’t think it’s very informative. Since the market was pre-pandemic at the time, I will include some data from 2019 if it is appropriate.

Make sure to follow our blog and social media accounts for updates on the latest news and thoughts.

I’ll begin with a quick history of the real estate market to provide some context.



Where we ended up

Foreign purchasers accounted for 8.9 percent of the market share in Spain’s property market at its peak following the 2008 global financial crisis. Only 7.3 percent of Spain’s housing market was occupied by foreign buyers in 2007. However, Andaluca’s market share was 20.6% that year, thanks to the 11,898 international purchasers that visited the region. Because of this, it’s easy to see how crucial the international market was to overall regional sales.

Since 2012, the number of buyers from outside the United States has steadily climbed. After the financial crisis of 2008, prices in Marbella were the first to climb in Spain’s Mediterranean coast. That was in the first quarter of 2014, and since then, prices have grown steadily. In 2018, Andalucia had the biggest number of international purchasers in a single year (18,918). By averaging the three years prior to the pandemic (18,454), we can observe that the global economy has expanded by 60% since the 2008 crisis. In contrast, Andaluca’s local market shrank by 44% in the same time period compared to its prior apex without foreign purchasers.

As a result, it is apparent that foreign purchasers form a key element of the overall Andalucia Property Market, regardless of transaction counts or market share. It turns out, in spite of all assumptions, that they are remarkably robust to the effects of Covid-19. So, what is it about Andalucia that attracts so many foreign buyers?


What’s the point of Andalucia?

One of Spain’s most diverse autonomous regions, Andalucia is the country’s biggest. Spain’s greatest historic cities, such as Cádiz, Málaga, Seville, Granada and Córdoba may be found here, as well as some of the country’s most beautiful beaches. Historic, Roman and Moorish ruins may be seen in cities like Ronda and Antequera; the white villages of Andalusia, known as “pueblos blancos,” are an integral part of the Andalucian landscape.


Andalucia truly has something for everyone, with a wide variety of properties to choose from. Everything along Spain’s Mediterranean and Atlantic beaches is a great place for soaking up the sun and sand in the summer. Although the majority of Spain’s Mediterranean coastline is located in Andalucia, many outsiders overlook the fact that just a tiny portion of Spain’s continental coast faces south. The rest of the property is east-facing, which has an effect on the winter climate. Due to the fact that a large portion of the Mediterranean slips into hibernation outside of the peak summer months, few areas are truly year-round destinations.

As a result, Andalusia’s southern Mediterranean coast is always bustling, especially in the popular golfing destinations. Winter temperatures in Europe are mildest in this region. Meanwhile, the Atlantic coast of Andaluca offers some of the world’s top wind and kitesurfing spots.

Just 45 minutes from the shore, in the Sierra Nevada, you’ll find Europe’s most southern and sunniest ski resort. Also, with slopes ranging from 2,100 metres to 3,300 metres above sea level, it is one of Europe’s highest ski resorts. Because of its elevation, it seldom shuts before May and is normally open till the end of November.

However, this wide range of weather conditions necessitates careful consideration by prospective homebuyers. Summer is scorching everywhere, but winter is a whole other scenario. It is possible to lose up to 10oC in temperature in the winter even if you live on the shore. Snow can fall as low as 800 metres above sea level in the sierras. If you’re not careful, you may even freeze.



For those who are into sports Andalusia is a wonderful destination for everybody who has ever wanted to visit. Even in the mountains, horseback riding may be found. Snow skiing, scuba diving, wind and kite surfing, rock climbing, and year-round tennis are just a few of the activities available in the area. Everything you need is right there, and the weather couldn’t be better.

Golf, on the other hand, is the most popular sport in Andalusia.

Málaga is home to 47 of the 102 golf courses in Golf Andaluca. Because of this, the Costa del Sol is known as the Costa del Golf. There are seven golf courses in the Sotogrande region of Cádiz province. Many consider Valderrama to be Europe’s greatest and one of the best in the world, making it the most well-known course. This course was the site of the 1997 Seve Ballesteros Ryder Cup.


Between October and May, more than 500,000 golfers visit Andaluca’s 25 percent of the country’s golf courses. The Costa del Sol’s year-round climate can’t be attributed to anything else than golf. The Mediterranean shores without a flourishing golf industry are generally quiet, with many taverns, restaurants and enterprises closing down. The golf industry in Andalucia provides an estimated €1 billion or more for the region’s economy. Golfers are predicted to spend almost twice as much per day as summer tourists.



Many of Europe’s most beautiful and historic cities may be found in Andaluca. The Phoenicians first founded Cádiz about 3,000 years ago, making it Europe’s oldest continually inhabited city. It was ranked 50th in the annual New York Times “52 best places to visit” list for 2019. Check out the New York Times bestsellers list.

Even if you don’t like sunbathing on the beach, there are plenty of other things to do in Andalucia that the Sunday Times recommends. As an example, you may do some hard trekking or explore the famous triangle of Andalucian cities. There’s also work being made on the plan to connect the 185-mile stretch of the Costa del Sol with a coastal trail.


Buyers from Other Countries in 2020 and 2021

There were 14,755 foreign property purchasers in Andalucia for the entire year 2020. Between March 2020 and June 2021, 4,000 international purchasers, on average, went missing in the three years preceding the outbreak of the pandemic. This time period encompasses the height of the lockdowns and travel restrictions. However, data for the first half of 2021 shows that the number of foreign buyers in Andaluca is rebounding strongly. Using the average of the first half of the three years preceding to the pandemic, the 2021 figure of 9,107 is a 2.2% decrease from the prior year’s total. That’s a lot better than Spain’s overall foreign buyer decline of 8% in the same time.


A Catch-Up and a New Request

As a result, we don’t know how many foreign purchasers who purchased a home in the first half of 2021 were among the missing 4,000. Definitely, the market is hopping. Many of the houses I’d planned to show my clients had already been sold by the time I finished assembling their shortlists. Because more people are entering the market at once than in a typical year, that’s what I think is the reason.

As a result of the lockdown and travel restrictions, some people are trying to make up lost time. However, if not for that, they would have been included in the 2020 data. In the first half of 2021, they appear with typical new demand. This is causing a shortage on the supply side, particularly in the resale market in high-demand areas. In addition, I believe the market is displaying indicators of higher-than-normal fresh demand at this time. We’ve heard from some purchasers who want to buy in Spain sooner rather than later. In addition, we’re seeing purchasers considering a Spanish property as a possible “work from home” location.

Notary statistics are gathered half-yearly, thus it takes a long time to acquire the full year’s numbers, as I’ve previously stated We may witness a return to pre-pandemic levels in Andalucia in 2021 when the new vaccines are delivered in May of 2022. True, second-half numbers are often lower than first-half numbers. Despite this, I believe they will see a spike in foreign purchases between June and December of 2021 when travel restrictions loosen up a bit more. Travel restrictions out of the United Kingdom to Spain were set to expire in August 2021, which means that British numbers are expected to rise considerably. If that’s the case, I wouldn’t be shocked if the year-to-date stats come close to or perhaps break the record established in 2018.


Andalucia’s Real Estate Sector Outside of Spain

If you look at the national average, which has been around 18 percent in recent years, you’ll see that Andalucia’s foreign market share is around the same. Andalucia’s foreign buyer market share was 15.4 percent and 15.5 percent in 2021, according to the latest estimates. These averages obscure the fact that foreign buyers are concentrated in a few areas and absent in others. As a consequence, instead of considering the entire area while looking at the foreign property market, it is preferable to consider particular provinces.

A notable illustration of how fragmented the property market is in Spain may be seen in Andaluco, where local and foreign industries operate separately. One of the most noticeable elements of Spain’s extended post-2008 crisis was how little impact the local economic disaster had on the international property market. While the domestic market was in freefall, it soared to new heights.

Andalucia’s 15.5 percent share of the overall market in the first half of 2021 was exactly in line with the 15.4 percent foreign market share of the total market. There are eight provinces in Spain, but only Málaga (the Costa del Sol) accounted for 27.5 percent of all foreign transactions throughout the time. On a local level, things get much more out of whack. A total of 46.1% of all transactions took place in the province’s four most populous municipalities: Málaga, Marbella, Benahavs, and Estepona. According to this, one-third of all purchases in Andalusian provinces came from a single region while half came from just four towns inside that region.

In the first half of 2021, 5,026 foreign buyers purchased property in Málaga province, whereas just 106 purchased property in the inland province of Jaén. However, even Granada’s Costa Tropical shoreline managed just 585.


Andalucía Property Market Prime Locations

Málaga province is the most populous in Andalusia, according to the data shown in the preceding section. The three most important municipalities in the province are Marbella, Benahavis, and Estepona, all of which are located within the province of Malaga. In 2021, only these three localities accounted for 21.5% of the province’s overall market. That jumps to 46% when the city of Málaga is included.

Granada province’s Costa Tropical has some of the best views of the ocean in the country, thanks to its proximity to the coast. Some residences on the beachfront even have direct access to the water. With properties ranging from modest studios to opulent mansions, the province of Cádiz’s Sotogrande is the headline attraction.

Iznájar, Ronda, Gaucin, Con, and Alhaurn el Grande are just a few of the best places to stay if you’re staying in the interior. A subset of international buyers (about 5 percent of the total) are once again attracted to the rural market since the financial crisis of 2008. Country homes with acreage or charming village homes seem to be the most popular choices for these homebuyers. They speak for themselves. Only 8 purchases were made in Iznájar in the first half of 2021, compared to 197 in Ronda, 9 in Gaucn, 117 in Alhaurn el Grande, and 138 in Con during the same period. At the municipal level, there is no domestic/international division; these data represent the whole. The rural market, as you can see, is rather small


Purchasing Power Abroad

Furthermore, the importance of international purchasers to the Andaluca real estate market extends beyond their sheer numbers.

They also spend more money. In most cases, international buyers pay more per square metre than local purchasers, on average. For example, in 2020, overseas buyers spent an average of €1,777 per square metre, which is 20% more than the local average of €1,438 per square metre.

So it’s heartening to see that this trend is continuing in the current data. As a matter of fact, it appears to be speeding up. There was no doubt that prices would rise in the international property market in 2021, and now we have the evidence to back it up. A 6.3 percent increase in the average price paid per square metre by a foreign buyer is forecast for 2021. That was Spain’s second-highest rate. Only the Balearic Islands had a higher percentage rise, 11%. Andalucia’s population is expected to grow by 13.7 percent in 2021, compared to the pre-pandemic figure of 2019.

A large portion of the abroad market’s activity is concentrated at the upper end of the market, as seen by the recent sharp increases in two of Spain’s most costly regions for foreign purchasers. A permanent boost for Andalucian businesses in 2021 was thus very welcome news for the region’s business community. Until December 31st, 2021, the regional administration discontinued the sliding scale of purchase taxes, which ranged from 8 percent to 10 percent. When the market was given an early Christmas present with minimal fanfare, they made the discount permanent. At higher price points in Andalucia, the benefits accrue to all customers, although the effect is more pronounced. This blog has all the specifics.

Spain’s Rental Market

Overall, Andalucia offers some of the strongest short and long-term rental yields and occupancy rates in the country. I don’t see the value in speculating about yields until we know for sure that Spain will be available to tourists in summer 2022. In the meanwhile, a few recent publications have piqued my curiosity that might have an influence on the short-term rental industry.

An official survey from Spain’s Institute of Statistics (INE) found that there were 321,000 vacation rental homes listed across the country. Catalua, the Valencian Community, and Andaluca are home to the majority of the country’s population, at 57 percent. 34,567 of these people live in the province of Málaga.

Short-term listings were pulled from various property websites, such as Fotocasa and Idealista, after the first lockdowns. Long-term listings, on the other hand, rose by around 20%. The number of long-term rentals available in Andaluca has increased by more than a factor of two. In fact, I’ve heard of landlords jumping from short-term to five-year leases in order to secure a renter and a steady stream of income. Those who have a five-year contract may have little choice but to leave the vacation industry. The short-term supply may be considerably decreased for multiple seasons if that is the case. As a result, short-term landlords may see an increase in occupancy levels if demand recovers in the meantime, which I believe it will.

Demand for New-Build Housing

When a brand-new home is on the market, overseas purchasers flock to it like moths to a flame for reasons I will never understand. Because the greatest places have already been built on, there is relatively little raw construction property that can be purchased. As a result, new construction is concentrated in less desirable areas.

New housing supply lacked the ability to keep up with demand after the recovery began. During the height of Spain’s construction boom in 2006, the country granted permits for 735,000 new homes, 21,000 of which were in Málaga province. There were just 798 building permits issued in the province in 2014, a 96.2 percent drop. To put it another way, the building business as we knew it has all but vanished.


Prices for new construction were affected by this mismatch in the supply side. Between 2013 and 2020 there were hints that new-build prices were being pushed down by rising project numbers. In fact, even before the arrival of COVID-19, I predicted that 2020 would come as a surprise to many developers. There were already rumours circulating about postponing the introduction of subsequent stages since sales had decreased.

Those that purchased off-plan at inflated rates before to 2020 are at the greatest risk, in my opinion. Even a minor drop in the market’s price means that their house will be worth less when they move in than they paid for it. I understand that many buyers aren’t aiming to earn a significant profit in the short term since they’ve made a long-term investment. Even before they get the keys, I’ve never met a person who was delighted with the thought of losing. Even if they own the property for a long time, some buyers may never see a return on their investment because of the inflated costs they paid for new construction. There has never been such a disparity between the cost of newly constructed homes and those for resale as there is right now.

Demand for Andalucian properties

In contrast, the scarcity of reasonably priced, high-quality resale houses in desirable areas makes it more difficult than ever before to make an informed purchase. In Spain’s property market, this sector is still by far the most important. The resale-to-purchase ratio is around 4:1. One significant shift is that purchasers are increasingly competing with one another for desirable properties in desirable locations due to increased demand. Before addition, a scarcity of inventory is increasing the pressure on buyers, whereas in 2019 I would have stated that purchasers were more likely to walk away from a transaction than to overpay.

For houses in sought-after areas, buyers must be ready to act swiftly. After conducting extensive research in preparation and receiving pre-approval for financing, one of our clients was able to purchase a house in Marbella in Q4 of 2021. There would have been a lot of interest in this magnificent beachfront property if it had been up for sale. Instead, no local agency was aware it was for sale, thus our client had an unfair advantage in the bidding process.

As a result of this, I have an issue with several of the pricing. It’s not uncommon for sellers to think that because new-construction prices have skyrocketed, they too may raise their pricing expectations. One of the largest valuation firms in Spain, Tecnocasa, found that resale asking prices on average are at least 20% more than the final price realised. Reduced asking prices from overly enthusiastic sellers are a sure sign of a successful sale. However, resale purchasers should keep three things in mind if they find a lower asking price on the market. At the onset, the product was overpriced. Second, it’s not in the greatest part of town. Thirdly, the vendor can be desperate. Instead than merely looking at the asking price, compare the prices per square metre.

The Price-per-square-foot Puzzle.

It’s a fantastic illustration of the new-build vs. resale pricing issue in Spain’s sixth most expensive city, Marbella. My customers were able to discover numerous houses in the best areas for €3,500 – €4,500 per square metre in Q4 of 2021. It was a resale in each case, not a fresh construction. It’s still a 25 percent rise over what I could find in the end of 2019 and beginning of 2020, shortly before the pandemic hit, even at the lesser level of €3,500.

The most costly houses I found for clients in 2021 that were either brand new or recently renovated were roughly €6,500 per square foot. Again, they were all in ideal locations, near the beach and within walking distance of everything, yet purchasers of new-builds in secondary places are paying these same costs per square metre and higher. It’s a non-starter.

Buyers should use extreme caution, especially in the new-construction market. When purchasing a new home, it is critical to conduct research and compare the asking price with comparables in the resale market. To avoid what an agent friend of mine refers to as ‘candles and pillows’ marketing, buyers in the new-build industry should be wary. Check the pricing per square metre and ask yourself if it makes financial sense to purchase these soft focus life-style photographs.

Predicted Trends in the Andalucia Property Market in 2022

This epidemic has astonished me with the strength of demand. There was already a queue for when Spain reopened during the 18 months of travel restrictions for our property-finding service, so this was not an anomaly. In all likelihood, a few prospective customers have placed their purchases on hold or given up on them completely. Contrarily, many of the folks I’ve spoken to during the numerous lockdowns have chosen to move their plans to buy in Spain forward. As though the epidemic has shifted their emphasis to the future.

Many inquiries, on the other hand, suggest that purchasers are bracing themselves for further price declines in 2021, akin to the devastation that followed the financial crisis of 2008. They’ll be disappointed, I’m afraid. I believe there were three elements that formed a perfect storm between 2008 and 2013. First, demand plummeted to near zero. It was gone in a flash, like if nothing had happened. As a result, there was a glut of unsold property on both the demand and supply sides. Third, easy finance and speculation fueled the real estate bubble. In my opinion, none of these circumstances exist right now. As I’ve shown in my research, the epidemic has resulted in an increase in both supply and demand, which has led to higher pricing overall.

2022: The Year of Correcting Mistakes

As long as you get a good deal, Andalucian property is still reasonably priced. The medium-term capital growth and strong rental return possibilities are both considerable. The days are long and sunny, and the people’s well-being is considered to be among the greatest on the planet. How can you dislike this?

I always provide the same counsel. Do not purchase any blighted goods. If it’s already noisy, it will only become worse as time goes on. If you see a mobile mast, you can bet there will be more because they tend to grow in number. Electricity pylons with high tension are likewise a no-no. We may expect a rise in new dwellings in the near future. Keeping tabs on local planning concerns and potential developments is so critical. While standing motionless, I’m able to count at least 20 cranes in various parts of the shore.

So while analysing houses for my clients, the following questions are usually asked: Is the price adequate to allow them to sell swiftly in the event of a change in circumstances? Second, is this a property that will always be in demand, regardless of the state of the market? There will always be a demand for high-end properties in great locations because of the present market’s focus on high-end properties in prime locations. Geographical proximity has always been, and will continue to be, a key consideration in real estate decisions of all kinds. Don’t compromise on location; it’s always the most important factor.

After the 2008 recession, foreign buyers were the driving force behind the market’s first rebound, purchasing in record quantities and increasing their market share starting in 2013. The post-Covid recovery will benefit from their presence, I believe. Many foreign purchasers are choosing Andaluca as their new home because of the new ‘work-from-home’ option that has become a reality following Covid.

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