THE first serious housing market figures of 2026 are now in, and they suggest the Spanish property market has started to lose momentum after a remarkable run post-Covid.
Sales are down, foreign demand is cooling, but prices are still rising, which is often what happens when the cycle starts to turn.
The latest figures from the Spanish notaries’ association show there were 170,552 home sales in the first quarter, down almost 8% compared to the same period last year.
That sounds significant, but Q1 2025 was exceptionally strong, so the comparison was always going to be demanding.
Even after the decline, sales were still 18% above the ten-year average, so this looks more like the market coming off the boil than falling off a cliff.
Looking at the regions of most interest to foreign buyers, the biggest fall in sales was in the Balearics, down 15%, followed by the Canaries down 11%.
Andalucia and the Valencia region were both down around 10%, with Murcia down 9%, Madrid down 8%, and Catalunya down 7%.
So the slowdown is broad-based rather than confined to one overheated market.
Foreign demand tells a similar story.
The latest figures from the Land Registrars’ Association show that 24,791 Spanish home sales involved a foreign buyer in Q1, down 3% year-on-year.
That was the third consecutive quarterly decline, suggesting the extraordinary post-pandemic boom in foreign demand has now run out of steam.
Before Covid, foreign demand was running at around 65,000 purchases a year.
After the pandemic it surged towards 100,000, driven by remote working, accumulated savings, a lifestyle reset and Spain’s enduring appeal.
The rolling annual total peaked in Q2 last year at just under 100,000 sales, and has edged down since.
That does not mean foreign buyers have disappeared.
Foreign demand is still exceptionally high by historic standards – but the direction of travel has changed.
What makes the picture more interesting is that prices are still going up.
According to the notaries, the average national price reached €2,022 per square metre in Q1, up 7% year-on-year and the highest first-quarter figure on record.
How can sales be falling whilst prices are rising? Sales tend to turn first.
Buyers hesitate, affordability bites and transaction volumes fall.
Sellers take longer to adjust expectations, so prices usually lag behind sales. In some cycles, prices never turn negative.
My view is that we are now moving from boom to soft landing, not a bursting bubble.
There has been no obvious lending frenzy, no massive oversupply, and no reckless rush to build.
Demand has been driven by immigration, foreign buyers, reasonable financing costs, economic growth and a chronic shortage of homes where people want to live.
I wouldn’t be surprised by a further weakness in sales this year, and a gradual cooling of price growth.
But unless the economy deteriorates sharply, I would not expect significant price falls.
The boom may be over, but the housing shortage is not.
Mark Stucklin runs Spanish Property Insight, a property information website, and was author of the Spanish Property Doctor column in The Sunday Times (2005-2008), and the book ‘Need to Know: Buying Property in Spain’ published by Collins.
www.spanishpropertyinsight.com
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