Spain: house prices rising twice as fast as EU average

Spanish house prices continue to rise sharply, and are doing so much faster than in the rest of Europe. In the third quarter of 2025, prices of existing homes in Spain rose by 15% year-on-year, compared to an EU average of 5.5% (Eurostat). This means that Spain is clearly performing worse than the European average. Across the EU as a whole, house prices rose by 1.6% compared to the previous quarter. Only countries such as Portugal, Croatia, and Slovakia saw stronger increases than Spain. This confirms that the Spanish real estate market is structurally out of balance. The main cause is a chronic shortage of housing. Demand is four times greater than supply, partly due to population growth, immigration, investors (now accounting for almost 10% of demand) and favorable financing. More than 200,000 new households are added each year, while only around 100,000 homes are built. According to experts, a price drop is unlikely in the short term. The current situation is the result of 20 years of failed housing policy, with too little planning, insufficient new construction, and increasing legal uncertainty. Without structural reforms, living in Spain will continue to be more expensive than in the rest of Europe. Translated with DeepL.com (free version)