The Keller Williams real estate network reports that, in 2019, the year before the onset of the coronavirus pandemic, purchasing a luxury home cost around €1.5 million. However, this figure has now risen to over €2 million, indicating a 28% increase in the value of these premium properties over the past five years.
Additionally, according to the company's report, the supply of properties priced above €800,000 has surged by 150% in five years, reflecting the upward trend in prices for this type of housing.
Keller Williams professionals indicate that the price and demand for this type of property have risen due to the growing interest from foreign investors with high purchasing power in our country. However, the potential tax restrictions that the Spanish government intends to impose on international buyers have left professionals in the sector uncertain about how these changes might affect the interest of other markets in attracting these buyers.
Málaga, the most "luxurious" province
The province of Málaga leads the ranking in the luxury real estate sector. Currently, 23.2% of the supply of such properties is located in this Andalusian province, with the average price estimated at around €2.6 million.
This surge in interest in Málaga is largely attributed to the renowned "golden triangle", which includes Estepona, Benahavís and, above all, Marbella – a town that has firmly established itself as a hub for luxury real estate.
In second place is the province of Alicante, accounting for 18.9% of the total supply of luxury homes, with an average price of 1.6 million euros. The Balearic Islands take third place, representing 12.7% of the supply and an average value of €2.3 million, with Mallorca and Ibiza being key highlights.
Following closely are the provinces of Barcelona (11.5%), Madrid (8.8%) and Girona (5.9%), with an average price of €1.6 million in Barcelona, €1.8 million in the capital and €1.5 million in the Catalan town.
The luxury sector's future
Keller Williams highlights that the monetary policy of the European Central Bank (ECB), which recently reduced interest rates to 2.75%, directly influences investment decisions. “In an environment of economic volatility, international investors are seeking diversification and security, making luxury housing in Spain an appealing alternative to other assets,” the real estate company explains.
Another factor they emphasise is the impact that inflation has on the real estate sector. In times when money loses value, investing in premium properties is seen as an "effective strategy to preserve capital in the long term," according to Keller Williams.
The return on this investment is, in part, driven by the economic profitability from rent, which the company estimates to be around 5-7% annually.
Leonardo Cromstedt, President of Keller Williams Spain, concludes, “Spain’s success lies in its ability to develop a premium real estate ecosystem with a sophisticated offering tailored to high-net-worth buyers.”
