Spain’s luxury property market grows despite higher borrowing costs
Demand for luxury homes in Spain remains strong as wealthy buyers, both local and foreign, see Spain as an attractive mix of lifestyle, climate, and potential return on investment. The market has held up even as interest rates rise, with many buyers viewing property as a stable store of value and a path to residency in the European Union. The Golden Visa program continues to attract buyers who want a pathway to residency and, in some cases, eventual citizenship through residence.
Foreign buyers accounted for a sizable share of purchases last year, with 88,000 real estate transactions involving non-residents reported by the College of Registrars, marking a 45% year over year increase. While foreigners represented about 13% of total transactions, their impact on pricing and demand has been outsized, especially in high-demand regions such as the Balearic Islands, parts of the Mediterranean coast, Madrid, and Barcelona. The Golden Visa segment saw 8,975 sales, up 63% from the previous year, with 34% of sales in the Balearic Islands to foreigners, 28.6% in the Canary Islands, and notable activity in Valencia and Alicante where foreign purchases exceeded 41% in some measures.
IDBO Consultants, a firm involved in facilitating Golden Visa procedures, notes that the right to reside in Spain often makes luxury homes more appealing. Many buyers pay in cash, accelerating transactions and sometimes bypassing mortgage needs. A portion of Spain’s luxury inventory is directed at this demographic, which tends to value cash purchases and higher upfront investment compared with domestic buyers.
Non-EU investors can obtain residency in Spain for two years, with the option to extend to five years, and then pursue citizenship through the residency track, provided all prerequisites are met. The profile of Golden Visa applicants is diverse; some seek family reunification or permanent residence more than investment itself, while others pursue the asset-backed route as a strategic move.
incentives
Legal immigration expert Julia Alejandra Guzmán Serrano highlights Spain as a safe, well-regulated destination with strong infrastructure and a favorable business climate for foreign investors. The Golden Visa allows lawful residence, with the potential for nationality by residence after meeting specific requirements.
To receive priority consideration, foreigners are advised to visit Spain at least once per year, ideally for a week or longer. Holders of this permit enjoy freedom of movement within the Schengen area, where most EU countries belong. From filing to decision, the typical timeline is up to six months, and the process does not always require in-person visits in Spain. Once granted, property assets can be monetized through rental income or capital appreciation.
requirements
The Golden Visa program requires an eligible real estate investment of at least 500,000 euros, or alternative qualifying investments such as 2 million euros in Spanish public debt securities, 1 million euros in shares or equity stakes in Spanish companies, 1 million euros in mutual funds, or 1 million euros in bank deposits in Spanish institutions.
Other conditions include: not being a national of a European Union member state; being over 18; a clean criminal record for the past five years in both Spain and the home country; having either public or private health insurance; showing sufficient financial means for oneself and accompanying family members if required; and committing to invest in Spain through real estate, equity in Spanish companies, or in Spanish public debt.
In practice, many Golden Visa applicants pursue real estate purchases as a reliable vehicle to secure residence, with the potential to combine personal needs with long-term financial planning.