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A Look at the Costa del Sol Property Market

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After several years of low sales and steadily-falling prices, the property market on the Costa del Sol appears to be on the road to recovery. This is particularly true of property in Marbella and Malaga city where sales are brisk and supply low.
Two recent reports by leading property companies highlight that the Costa del Sol has reached a turning point as far as property is concerned. The number of transactions has soared and house prices appear to be rising. In this article, we summarise the main points in reports by CB Richard Ellis (CBRE) and Tinsa, both examining the property market in Malaga province.
Change of direction for Costa del Sol property
CBRE report that 2014 was a record year for property in Malaga province with a total of €500 million invested in different types of property (residential, commercial, hotels and industrial). The property consultancy company predicts that investment during this year will triple this amount since the market on the Costa del Sol has “changed direction” and is now on a path of consolidated growth.
Sales of property in Malaga province rose by 30 per cent last year, totaling over 24,000 transactions. The total capital invested by buyers increased by 27 per cent and the market in Malaga represented the fourth largest in Spain in 2014, behind just Madrid, Barcelona and Alicante.
According to CBRE, supply of property has dropped to very low levels in two keys areas of the Costa del Sol, Marbella and Malaga city. Both are now seeing a serious return of new development for the first time for nearly a decade.
As far as prices go, CBRE reports that they continued to fall during 2014 but at a considerably slower rate. Figures released by Fotocasa, an online property portal, show property prices in Malaga went up by around 2 per cent in the year to June.
Clear signs of recovery
In their quarterly report on coastal property in Spain published in June, the valuation company Tinsa highlights Malaga province as one of the few places in Spain where there are “clear signs of recovery” in the property market. According to Spanish Coastal Property Q2 2015, areas such as Benahavis, Estepona, Manilva and Marbella have reached a turning point in their adjustment.
Costa del Sol resorts make up three of the five top places in Spain with the most sales during 2014. In Marbella, property sales went up by 28.7 per cent, in Estepona they rose by 26.6 per cent and in Mijas the rise was 14.7 per cent.
Sales of new-build property were even higher – those in Manilva were the highest in Spain with an increase of 193 per cent and those in Marbella went up by over 100 per cent. The Tinsa report reiterates the CBRE findings that supply is very low in Marbella and highlights that new development is now commencing in Benahavis, Estepona and Marbella.
Property Market in 2015
At Andalusian Lawyers, we have clearly seen a surge of interest in property sales and purchases on the Costa del Sol over the last 18 months, and in our opinion, the market has entered a new cycle. It is, however, still a buyer’s market so there’s room for negotiation on prices but bargains are now thin on the ground.
But regardless of what point of the cycle the market is at, professional and independent legal advice is absolutely vital when you’re buying property in Spain. At Andalusian Lawyers, we advise contacting a lawyer as your first step when you’re looking to buy. Get in touch with us now for information on our comprehensive services for property buyers and a free quotation of our fees.
If you’d like to know more about what buying a property in Spain involves, download our free guide here.

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