Alicante Captures 43% of Foreign Home Sales in Spain — What Investors Need to Know

Spain's real estate story in Q3 2025: foreign demand stays firm

The Spanish real estate Spain market kept proving its resilience in the third quarter of 2025. At a time when global capital and travel patterns are shifting, foreign purchases of second homes exceeded 9,100 transactions, up 8% year-on-year, and accounted for 5.2% of all home sales. That combination of volume and sustained international interest matters for buyers and investors weighing coastal and urban opportunities.

Quick snapshot of the numbers

• Total home sales in Spain (Q3 2025): 174,384, a 4.7% increase versus Q3 2024.
• Foreign second-home purchases: >9,100, +8% year-on-year, representing 5.2% of total sales.
• Alicante foreign transactions: 5,741, 43.29% of the national total for foreign buyers, up 0.21% year-on-year.
• Malaga foreign transactions: 2,750, with a 31.84% foreign share.

These raw figures are from an analysis by Sonneil Homes covering Q3 2025. We looked at what this data means for liquidity, pricing pressure, regional winners and losers, and the near-term outlook for international buyers.

Why Alicante dominates the foreign buyer ranking

Alicante is the headline grabber. With 5,741 purchases by foreigners in Q3, it accounted for 43.29% of all foreign transactions in Spain and registered a small rise versus the prior year. Our reading is that several structural factors explain this performance:

• Geographic depth of the Costa Blanca offering: a wide range of product types and price points gives buyers options whether they seek a modest holiday flat or a higher-end villa.
• International connectivity: Alicante and nearby airports provide direct flights from Northern Europe, boosting accessibility for both owners and rental guests.
• Market liquidity: a high turnover of second homes improves resale prospects, an important factor for investors and returning buyers.

For investors, Alicante's dominance means stronger secondary market liquidity but also greater competition. Properties in the most sought-after micro-locations will stay in demand; at the same time, rising competition can compress yields for short-term rentals if supply increases sharply.

Costa del Sol and the coastal split: Malaga remains strong

Malaga recorded 2,750 foreign-led operations in the period, with foreigners accounting for 31.84% of transactions in the province. Together, Alicante and Malaga made up 35.9% of foreign purchases in Spain for Q3 2025 — nearly four of every ten foreign deals.

Where Alicante offers breadth, the Costa del Sol is established as a premium product with long-standing international buyer communities. That persistence matters:

• Established tourism infrastructure and high-quality services maintain year-round demand for rentals and resale.
• Malaga's strong foreign share highlights investor confidence in higher-end coastal product.

That said, investors should weigh the price premium against expected rental yields and occupancy cycles. High tourist demand reduces downside risk but can invite tighter local regulation on short-term rentals, which affects cash flow assumptions.

The Mediterranean coast beyond the two leaders

The Valencian and Castellón provinces, plus Murcia, are showing healthy activity and some acceleration compared with last year.

• Valencia recorded 10,491 transactions, +2.48% year-on-year, with foreign buyers making up 11.25% of sales. This reflects a balanced mix of domestic and international demand.
• Castellón posted +9.53% growth in total sales and its foreign share rose to 13.58%, strengthening the appeal of towns such as Peñíscola, Oropesa and Benicàssim.
• Murcia is emerging: 6,588 sales, +5.02% year-on-year, and a foreign share of 21.89%. Its competitive pricing and quality-of-life features are attracting buyers priced out of the more mature Mediterranean markets.

For buyers seeking value and upside, Murcia and Castellón are worth studying. These are markets where a disciplined investor can find stronger capital-growth potential than in the stretched prime strips of the Costa Blanca or Costa del Sol, but they come with trade-offs in terms of infrastructure and seasonal demand.

Island markets: mixed signals from Balearic and Canary Islands

The island chains show different trajectories in Q3 2025. The Balearic Islands saw total sales rise 3.17%, yet their foreign share fell by 3%. The Canary Islands registered declines in both sales and foreign share in some provinces:

• Santa Cruz de Tenerife: sales -7.23%, foreign share -3.15%.
• Las Palmas: sales -6.60%, foreign share -0.92%.

These shifts suggest the islands are facing a rebalancing: local or domestic demand is picking up relative to foreign buyers in some areas, and price or access dynamics are influencing the composition of buyers. Investors who rely on international visitation-driven yield should reassess assumptions about occupancy and guest origin.

Urban markets: Barcelona rises, Madrid steadies

City markets are behaving differently from the coast. Barcelona increased sales by 9.62%, driven largely by domestic buyers rather than international buyers. Madrid was practically flat with a -0.61% change in sales and a contained foreign share of 6.85%.

This split matters:

• Barcelona's recovery points to strong local demand and a reactivation of the urban resale market. Buyers eyeing city apartments should expect stronger competition from Spanish buyers and potentially stronger capital appreciation in prime locations.
• Madrid's stability signals a mature market with less volatility but also less immediate upside for aggressive yield-seeking investors.

Who is buying: nationalities and diversification

The composition of foreign buyers is changing. The UK continues to lead historically but its share is down to 7.9% from 28% back in 2006.