Malaga and Costa del Sol lead the luxury real estate market in Spain

Friday, July 21, 2023 at 09:57 a.m. A third of all luxury homes in Spain are in Málaga, and the most expensive area to live was Los Monteros in Marbella. According to a report on the market for luxury real estate in Spain, prepared by the insurance company Hiscox, the province offers for sale 2,500 homes worth more than three million euros. This represents 34% of the total number of luxury properties in Spain and places Málaga in first place.

Most of these properties are located in the so-called "Golden Triangle", formed by Benahavis, Estepona, and Marbella. Los Monteros in Marbella, where the price per square meter reaches6,842 euros, which turns into villas worth up to17 million euros, has become the most expensive area to live in the province. Lomas de Marbella-Puente Romano with an average price of6,173 euros per square meter and a maximum price of35 million euros for a house - is the second most expensive area to live in Malaga.

Next in Spain are the Balearic Islands with 33% of the total number of luxury homes for sale, followed by Madrid with 10% and Barcelona with 6%. La Zagaleta, Puerto Banús and Finca Cortesin. Although it doesn't top the price ranking, the report points to La Zagaleta's luxury housing development as "the most exclusive in Europe." "It is located close to the sea and nature, and offers a wide range of services, from a helipad and horseback riding to the services of nannies, cooks or drivers," the report says. Houses in the area cost between three and 30 million euros, with an average price per square meter of 5,804 euros and an average size of 1,000 square meters. Houses in the area are mostly owned by foreigners from the UK, Germany, Scandinavia, Russia and Arabia. The report also mentions other areas of Marbella such as Puerto Banus with a price per square meter of 5,240 euros and a maximum price of 15 million euros per property, and Las Brisas with an average price of 5,140 euros per square meter and a maximum price of 14 million euros. The report also points to the little-known neighborhood of Finca Cortesin, located in Casares, between Sotogrande and Marbella. "Selected several years in a row as the best golf resort in Europe, this 215-hectare complex features a large luxury hotel and exclusive private villas next to the golf course, with 24-hour services for owners," the report said.

"The province of Málaga has positioned itself as a luxury destination, thanks among other things to its good air connections with the rest of Europe, with direct flights to 48 cities outside Europe and almost one hundred European cities, which are the main suppliers of foreign buyers of luxury homes in our country," the report adds. Marbella and Benahavis are the most sought-after areas for luxury real estate in the province of Málaga. Among these two municipalities, the best locations include the Golden Mile of Marbella and the La Zagaleta complex.

By the end of 2022, homes worth more than three million euros represented just over 3.5% (almost 2,900 homes) of the total number of property sales in Marbella and Benahavis. This figure is a sharp increase compared to 2021, when 1,800 properties were sold, representing around 2% of the total.

As for the current "residual", homes worth more than three million euros represent 6% of the total in Marbella and Benahavis. From second to first residence The study details the "mix" of buyers in Marbella: "mainly the wealthiest Madrid residents, followed by the British, who, despite Brexit, remain loyal to this municipality and account for 20% of purchases by foreigners, as well as the French and northern Europeans". Among buyers from Madrid, there is a clear trend related to the Covid-19 pandemic: "These buyers used to spend their vacations and many weekends a year in Marbella. Now, however, many have established their primary residence in Marbella and only occasionally travel to Madrid for business meetings." The report notes that since the pandemic, "new behavioral patterns in the use of two or three residences, and sometimes more, have spread." "With the development of remote working opportunities, it is becoming relatively common for the ultra-wealthy to have residences in multiple locations around the world where they can spend time seasonally. Mobility and adaptability have become their new watchwords," the report adds.

Spain is the fourth country in the luxury real estate market "The luxury real estate market in Spain is experiencing significant growth and more and more high-net-worth individuals are deciding to invest in it," said Eva Peribañez, director of the Arts and Private Clients division of Hiscox Spain. Luxury real estate prices in the country have risen by 10-20% in the past two years and the insurer believes they will remain stable in the future. Spain is now the fourth country in the world (after the US, UK and Australia) where ultra-high-net-worth buyers (UHNWI, i.e. those whose wealth exceeds $30 million) make the most investments. "The results of the report confirm our perception of a significant increase in this type of customer in Spain. And this is accompanied by a generational shift, as in just a few years, in 2025, millennials and Generation Z will represent 60% of the luxury market," said David Heras, CEO of Hiscox Spain. Hiscox expects the luxury real estate market to continue to flourish. "Due to the reduced need for financing for buyers, the increase in interest rates is not currently affecting the average price of luxury homes, nor is it reducing interest in buying, as a large number of transactions are being carried out without the need to apply for financing," the report explained. "In terms of the economic situation we are in, where various experts are predicting a new period of