Slowing sales in Spain, but prices will rise by 7% in 2026, according to BBVA Research

A new report from BBVA Research confirms the core reality of the Spanish property market: sales volumes are slowing due to a chronic lack of supply, but this same scarcity is forcing prices into a new phase of strong appreciation. The bank’s highly current "Real Estate Observatory" (November 2025) projects that while the overall number of transactions will stagnate in 2026 - forecasting a negligible -0.3% change - national housing prices are secured for another year of significant growth, projected to climb by 7.0% in 2026. This trend provides exceptional security for long-term investors: your asset value is insulated from any market fluctuation by an unstoppable structural deficit.

Structural deficit & price growth in Spain

The reason behind this price acceleration is simple and structural: Spain cannot build fast enough to meet demand generated by strong employment, migration, and the appeal of buying over increasingly expensive renting.

The BBVA data confirms the severity of this fundamental imbalance:

• Cumulative housing deficit: Between 2021 and 2025, Spain accumulated a housing deficit of approximately 625,000 households whose housing needs were unmet by new construction.
• Price resilience: Despite the sharp nominal price rises, the price remains 30% below the 2007 bubble peak in real terms, confirming market recovery, not a speculative boom.
• Accelerating prices: This deficit drove prices up by a confirmed 9.7% in the first half of 2025, a momentum BBVA forecasts will lead to a 10.1% rise for the full year. This sharp growth sets the foundation for the stable 7.0% appreciation expected in 2026.

Sales slowing down is viewed as healthy

The projected stagnation in sales for 2026 is actually a positive signal for the market's long-term health. It is not a sign of collapsing demand, but rather a confirmation that:

• Supply is exhausted: The market has simply run out of available inventory, especially quality, affordable stock in high-demand areas.
• Marginal demand is culled: The steep rise in prices means that marginal buyers, often those highly sensitive to mortgage rates and dependent on full financing, are being priced out. This culls speculative demand and leaves the market in the hands of secure, long-term investors.

Where foreign capital is leading the way

The slowdown in sales is felt most acutely in two areas: non-primary residences (second homes, investments) and the capital region of Madrid.

The BBVA report highlights that transactions in the non-primary residence segment are slowing down, and regions like Madrid saw main housing transactions fall by around -6% in Q2 2025 compared to Q1.

This pressure confirms the extreme scarcity in the areas preferred by our foreign buyers:

• Affordability crisis: For domestic Spanish buyers, the "effort to buy" (the percentage of income needed for a mortgage payment) remains critically high in regions like the Balearic Islands and Madrid. This domestic hurdle creates a two-tiered market where foreign capital remains dominant due to its currency advantage.
• Málaga & Balearics: Price growth in these key expat markets remains far above the national average, confirming the continued high demand driven by lifestyle and international wealth migration.

The Construction bottlenecks

BBVA identifies that the primary market constraint is the inability to increase supply. While new housing construction will grow by 10% in 2025 and 12% in 2026, this volume is still insufficient to meet demand.

The core bottlenecks are structural and cannot be solved quickly, which is why BBVA guarantees years of price appreciation:

• Labour shortage: The construction sector faces a quadrupled volume of unfilled vacancies since 2016 and a serious ageing problem among its workforce. This, combined with low builder profitability and high material costs, severely limits the ability to increase supply.
• Regulatory uncertainty: Complex and lengthy bureaucracy, combined with regional tensions over land development, continues to delay project execution.

These constraints ensure that the 625,000 housing deficit will take a long time to close, securing asset value growth for investors through 2026 and beyond.

Seize the price guarantee

The message from BBVA Research is clear: while sales volume may become flat, the underlying strength of the Spanish housing market is guaranteed by an acute, structural supply deficit. For the foreign investor, this means the 7% price increase forecast for 2026 is virtually secured. Now is the ideal time to enter the market and ensure your capital is positioned to benefit from this long-term, non-speculative growth. Explore our properties for sale now and secure your long-term investment in Spain.