Standfirst: Foreign buyers accounted for a record 16.05% of Spanish home sales in the third quarter, while prices reached new highs. Yet overall transactions and mortgage registrations continued to decline.
Foreign buyers are playing a larger role in Spain’s housing market even as domestic activity shows signs of slowing. More than 26,300 homes were purchased by international buyers in the third quarter, representing the highest share of Spanish home sales recorded since the series began.
The figures, published by Spain’s College of Registrars, show a market caught between strong price growth and weaker transaction volumes. International demand remains particularly influential in the Balearic Islands and the Valencian Community, while sales and new mortgage registrations have fallen for a third consecutive quarter.
Foreign buyers take record share of Spanish home sales
Foreign purchasers accounted for 16.05% of all Spanish home sales between July and September. Citizens of European Union countries represented 54.7% of those purchases, while buyers from elsewhere in Europe accounted for a further 17.8%.
By nationality, British buyers made up the largest group, representing 7.5% of purchases by foreign nationals. Moroccan citizens accounted for 6.4%, followed by buyers from the Netherlands at 5.8%.
The geographical concentration of international demand was especially clear in coastal and island markets:
- Balearic Islands: foreign buyers accounted for 37.2% of sales.
- Valencian Community: foreign purchasers represented 30.4%.
- Other autonomous communities: the foreign-buyer share remained below 30%.
The figures underline the importance of international demand to Spain’s regional property markets. They also show why national averages can conceal major differences between areas popular with overseas buyers and regions where the market is less exposed to foreign purchasing.
Spanish house prices reach another record
Prices continued to rise during the third quarter. The College of Registrars’ repeat-sales house price index increased by 15.8% compared with the same period a year earlier and by 5.2% compared with the previous quarter. Both measures pushed the index to a new record.
The average residential price reached €2,512 per square metre. Existing homes averaged €2,462 per square metre, while new-build properties reached €2,701 per square metre.
A separate measure of average prices suggested that the pace of growth may be moderating, despite the record levels. Under that methodology, prices rose by 1% quarter on quarter and 9.3% year on year.
Madrid recorded the highest average regional price at €4,565 per square metre, narrowly ahead of the Balearic Islands at €4,502. The Basque Country followed at €3,693, with Catalonia at €2,989 and the Canary Islands at €2,850.
Among provincial capitals, San Sebastián remained the most expensive, at €6,662 per square metre. Madrid followed at €5,597, ahead of Barcelona at €5,124, Palma at €4,408 and Bilbao at €3,877.
Home sales decline for a third consecutive quarter
Rising prices have not translated into increased market activity. Spanish home sales fell by 5.9% year on year in the third quarter and by 2.3% compared with the previous three months.
A total of 164,148 transactions were recorded between July and September, the lowest quarterly volume in nine quarters. The decline marked the third consecutive quarter in which sales fell compared with the preceding period.
Existing homes accounted for most transactions, with 129,537 sales, although that figure was 2.6% lower than in the previous quarter. New-build sales reached 34,611, down 0.9% quarter on quarter.
Quarterly declines were recorded across ten autonomous communities and 27 provinces, indicating that the slowdown was not confined to a single local market.
Mortgage registrations also weaken
Mortgage activity followed the broader decline in sales. Spanish registrars recorded 124,145 home mortgages during the third quarter, a quarterly fall of 3.9%. The figure equalled 75.6% of all home sales recorded during the period.
However, the longer-term picture remained more positive. Over the previous twelve months, 519,388 mortgages on homes were registered, 6% more than in the preceding twelve-month period.
Andalusia recorded the highest number of mortgage transactions during the quarter, with 23,635. Catalonia followed with 23,268, ahead of Madrid with 18,240 and the Valencian Community with 15,692.
Madrid also recorded the highest mortgage amount per square metre, at €3,158. The Balearic Islands followed at €2,987, with the Basque Country at €2,392 and Catalonia at €2,248.
What the figures mean for Spain’s housing market
The data point to a two-speed property market. Prices continue to reach records, supported in part by demand in areas attractive to international purchasers. At the same time, fewer homes are changing hands and mortgage registrations are falling.
That combination may indicate that affordability pressures are limiting the number of potential buyers, even while demand remains strong enough to sustain price growth in sought-after locations. The figures do not, on their own, establish the cause of the slowdown or predict how the market will develop next.
For overseas buyers, the results confirm the continuing importance of Spain’s coastal, island and major-city markets. For domestic purchasers, the gap between incomes, financing conditions and asking prices remains an important factor in access to housing.
Conclusion
Foreign buyers reached a record share of Spanish home sales in the third quarter, while residential prices climbed to new highs. But the simultaneous fall in transactions and mortgages suggests that Spain’s housing market is losing momentum beneath the headline price increases. The next set of registrars’ data will show whether international demand can continue to support prices as overall activity weakens.