Girona, Cádiz and Málaga – Spain’s new investment hotspots?

Latest price data from one of Spain’s leading property portals shows significant price increases in several of the country’s smaller cities.


According to Idealista, Girona, Cádiz and Málaga registered some of the biggest rises of 20.3%, 10.7% and 8.3% respectively in the year to the end of June 2019.  Other cities such as San Sebastian and Granada also saw above average hikes of 8.2% and 7.2% respectively.

Average prices across Spain rose by 6% in the last 12 months.

For the first time in 5 years, prices dropped marginally in Barcelona, by 0.9%. In Madrid prices rose by 9.0% and in Valencia by 8.7%.

Spain's hotspots

“This is an exciting time for so-called second tier Spanish cities,” comments Lucas Fox co-founder Alexander Vaughan. “I think that Barcelona and Madrid will show slightly reduced growth over the coming months but will no doubt retain their status as key investment hotspots. Prices along the Spanish coast will continue to grow at a steady pace – some  coastal areas still have not yet seen major recovery yet and there are some great opportunities around. However, investing in up-and-coming cities such as Girona and Málaga could bring investors some very healthy returns in the mid-term, with double digit growth in many cases.”

Forecasters predict that over the next few years there will be a big switch from renting to buying in Spain, which is expected to generate demand in areas that are yet to pick up, particularly on the outskirts of major cities. This trend, along with the continued strong demand for property by foreign buyers, is expected to drive the sector further forward.

Currently, the ‘stand-out’ second tier city is Girona, whose 20% price growth is more than 3 times the Spanish average. Transactions in Girona Province have increased by around 60% since 2012 (INE) and Lucas Fox’s own Girona office has seen sales increase by 29% in the first half of the year.

“The current buzz in and around Girona city is phenomenal,” comments Lucas Fox Girona & Costa Brava Director Tom Maidment. “In the last few year this historic, vibrant hub has become a magnet for foodies, a must-see city for discerning travellers and a mecca for cyclists from across the world. Located just 40 minutes from Barcelona via high speed train, the city is becoming an increasingly attractive proposition for investors and buyers priced out of the Barcelona market. We have seen unprecedented levels of investment in city centre properties in the past year or so and interest in rustic homes in the beautiful surrounding countryside – above all in the Empordà, Gironés and Pla de l’Estany areas – has also soared. This is is an exciting time for the Girona market.”

Málaga too has caught the eye of canny investors. For decades Picasso’s birthplace was viewed by international visitors simply as a gateway to Marbella and other popular destinations along the Costa del Sol. Málaga is now making strides in almost every sector, from gastronomy and architecture to art and culture. A discerning, international crowd have taken note, with tourism figures increasing year-on-year. This has inevitably had a positive effect on the real estate sector, which has seen transactions in the province grow by around 50% in 5 years.

Further along Spain’s southern coast on the Costa de la Luz, the historic province of Cádiz has also seen sales soar in recent years, up around 60% in 5 years. Cádiz city was also recently named as one of the must-visit places during 2019 by the New York Times.

“In 2019, investors might need to adjust their strategies and start to include homes outside the key Spanish cities in their properties portfolios,” adds Vaughan. “If they take the right advice, returns of around 15% are not unrealistic.”

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