Prices continue to rise, but sales remain strong:
The real estate market on the Costa del Sol and across the province of Málaga experienced impressive growth in 2024. Despite the sharp rise in property prices, home sales and mortgage contracts continued to trend upwards. What are the key figures and insights?
Málaga leads in price increases
According to Spain's Ministry of Housing and Urban Agenda, property prices in Málaga increased by 11% to €2,522.20 per square meter. Only the Balearic Islands saw a higher increase at 12.1%. In terms of absolute price per square meter, Málaga ranks sixth in Spain, behind Madrid (€3,370.50), Barcelona (€2,766.90), and a few other provinces. The national average price per square meter at the end of 2024 was €1,972.10, reflecting an annual increase of 7%.
Increases Above 10%
Within the province of Málaga, nearly all major municipalities saw price increases of more than 10%. Estepona experienced the largest growth, with a 20.4% rise to €2,347.50 per square meter. Benalmádena, Fuengirola, Marbella, Mijas, Vélez-Málaga, and Torremolinos saw increases between 18% and 19%, while Málaga city and Rincón de la Victoria recorded rises between 16% and 17%. Marbella remains the most expensive city in the province, with an average price of €3,037 per square meter, while Antequera (€1,184.20) and Ronda (€1,214.40) are the cheapest.
Growth in Home Sales
Despite rising prices, a total of 35,385 homes were sold in Málaga in 2024, a 4% increase compared to 2023. This means the province accounts for nearly 30% of all real estate transactions in Andalusia. Across Spain, home sales increased by nearly 10% to 642,000 transactions. Notably, Málaga experienced a sales surge in December 2024, with transactions rising by 44% compared to the previous year.
New Homes in high demand
The demand for newly built homes increased significantly. In Málaga, new home sales grew by 58% to over 10,700, the highest figure since 2011. Meanwhile, sales of pre-owned homes dropped by 9% to 24,657. Despite this shift, the second-hand housing market remains dominant.
Real estate experts warn of potential future challenges. According to María Matos of property platform Fotocasa, the persistent demand for new builds could further drive up prices. Developers are facing rising land and construction material costs, along with bureaucratic delays in launching new projects. Francisco Iñareta from Idealista warns that these pressures could lead to continued or even accelerated price increases.
Mortgages and cash purchases
The mortgage market also flourished in 2024. In December, 1,957 mortgages were issued in Málaga, a 62.4% increase from the previous year. Over the course of the year, 20,070 mortgages were taken out, 2.2% more than in 2023. Notably, despite this growth, many homes are still purchased in cash. The average mortgage in Málaga was €186,717, making it the third-highest in Spain after the Balearic Islands (almost €290,000) and Madrid (almost €236,000). According to INE data, the average mortgage in Spain is around €152,000, meaning Málaga is significantly above the national average.
The growth of Málaga's mortgage market was partly driven by falling interest rates and a strong labor market. Interest in real estate remains high, and buyers appear willing to take on larger loans despite rising home prices.
Conclusion
The real estate market in Málaga remains strong, with rising prices and an increasing number of transactions, particularly in the new housing segment. Demand for homes, both from domestic and international buyers, continues to be high. However, the question remains whether this growth is sustainable given the rising prices and potential bottlenecks in the construction sector.
If demand for new builds continues to rise while supply remains limited, prices could climb even higher. This could make homeownership increasingly difficult, especially for local buyers. The coming years will be crucial in determining whether Málaga can maintain its status as one of Spain's most attractive real estate markets.
Comments