Madrid, Barcelona, Valencia, Alicante, and Santa Cruz de Tenerife drive nearly half of Spain’s national housing deficit, pushing home prices up over 20% as supply fails to keep pace with demand. Explore data and forecasts in the latest Spain real estate update.
Spain’s real estate market is experiencing unprecedented pressure in its biggest urban hubs, with fresh data revealing that Madrid, Barcelona, Valencia, Alicante, and Santa Cruz de Tenerife together account for nearly half of the country’s pent-up demand for housing. According to the Association of Real Estate Consultants (ACI), these provinces have amassed a housing deficit of 178,000 homes between 2020 and 2024—a staggering figure given that Spain’s national housing shortage currently stands at around 350,000 units.
This imbalance between newly formed households and homes constructed is sharply felt in Madrid, which leads the list with 44,900 more households created than homes built in the past five years. Close behind are Barcelona (43,983), Valencia (32,790), Alicante (31,142), and Santa Cruz de Tenerife (25,339), highlighting a clear trend: Spain’s major cities are facing the greatest housing strains.
Beyond these, Murcia (24,179), Las Palmas (18,663), Tarragona (16,528), the Balearic Islands (16,174), and Malaga (15,235) also report significant shortfalls. The ACI warns that “these figures are especially relevant because they are markets with high demand pressure, which aggravates residential tension and can have an impact on the upward evolution of sales prices.”
Housing Deficit Drives Spanish Home Prices Higher
The direct consequence of this shortage in Spain’s most in-demand regions has been a dramatic increase in property prices. According to the Registrars, the cost of purchasing a house has surged by more than 20% in all the major deficit provinces except for Barcelona, where prices have still jumped by 16%. The Balearic Islands and Malaga stand out with staggering price increases of around 45% since 2020, further squeezing buyers and investors looking for opportunities in Spanish real estate.
Smaller but still significant deficits exist in cities like Granada (13,407), Girona (12,662), Cádiz (12,347), Almería (9,530), and a handful of other provinces, all experiencing double-digit increases. In Cádiz, prices have soared by an eye-watering 32.5%, while in Toledo, even with a lower deficit, home prices have risen by a steady 13%.
Stable Prices in Spain’s Balanced Housing Markets
Conversely, there is another side to Spain’s property story. In regions such as Asturias, the housing market is notably more balanced, with 6,800 more homes built than households formed. Guipúzcoa, Cáceres, and Burgos also show a housing surplus, helping to keep price increases minimal or, in cases like Palencia and Zamora, allowing for small declines.
The ACI points out, “Although thirteen provinces have surpassed the creation of housing despite the year 2024, their overall impact is relatively limited, as they only add up to 5,005 homes above the homes created.” This phenomenon is attributed to more agile urban development, improved municipal planning, and a dynamic local construction sector.
In these more stable markets, home price growth is far less aggressive. In fact, areas like León (0.4%), Salamanca (3%), Ciudad Real (4%), and Zamora have seen minimal growth, if not outright decreases, in property values — offering relief for local buyers and a different outlook for investors seeking stability over meteoric rises.
What This Means for Buyers, Sellers, and Investors in Spain
For buyers and investors, the current landscape means fierce competition and escalating prices in Spain’s largest and fastest-growing metropolitan areas. The chronic housing shortage is expected to keep upward pressure on property values in Madrid, Barcelona, Valencia, Alicante, and Santa Cruz de Tenerife, making early entry and strategic investment crucial for those looking to capitalize on the Spanish real estate market.
For those with flexibility, opportunities exist in secondary provinces where construction keeps pace with demand and price growth remains moderate or even subdued.
Looking forward, market analysts point out that alleviating Spain’s residential tension will require not only more building—but also faster permit processes, urban planning innovation, and long-term strategies to balance supply and demand across the country.
