Costa del Sol Market Review Q1 2021

A glance at the latest statistics for the Costa del Sol property market shows a completely different story to 2020. This time last year, Spain was just emerging from a 7-week total lockdown, and the real estate sector had come to a halt. Fast-forward three quarters, however, and the scenario is in complete contrast. Property sales in both Malaga city and the Costa del Sol were buoyant in the first quarter of the year. And prices are on the up in the area. In this Costa del Sol Property Market Review Q1 – 2021, we look at the figures in detail and analyse what they could forecast for the rest of 2021.

The figures and the lifting of travel restrictions into Spain lead analysts to predict that “a quick recovery” is on the horizon.

Costa del Sol property sales in Q1 2021

The first three months of the year registered a busy quarter on the Costa del Sol. According to the Registrars Association (Colegio de Registradores) report for Q1, 7,208 properties exchanged hands in the area between January and March.

This represents a 14.4% rise on the previous quarter. The resale sector saw particularly brisk activity. The type of transactions soared by 18.3%.

Yearly figures aren’t quite so positive. Sales fell by 18.1% between April 2020 and March 2021, although the decrease wasn’t as high as some analysts expected given national and international travel restrictions. However, there was much better news for new-build properties – sales skyrocketed by 26.2% in the year.

Costa del Sol has some of the busiest sales activity in Spain

At the national level, the Costa del Sol posted some of the best sales figures in Q1 this year. In terms of total sales, 23,518 property transactions took place, the fifth-highest figure in Spain.

Sales of new-build properties reached 6,319 in Q1, the third-highest in Spain (behind just Madrid and Barcelona). The figure represents a rise of 26.2% in a year.

Bottom line? Sale figures are starting to show pent-up demand, which will only increase as Spain relaxes its travel restrictions from June onwards.

Costa del Sol Property Prices in Q1 – 2021

Spain publishes no official selling price statistics – most of those available are based on valuations or asking prices on online portals. However, a look at different sources gives a useful overview of the situation. It also shows that the general trend for prices on the Costa del Sol is up.

Registrars’ Association (based on declared prices in title deeds)

The average price reached €2,010 per square metre in Q1, which translates to an increase of 0.9% on Q4 2020 and 3.9% in the year.

Tinsa (based on valuations)

Prices rose by 0.3% in the year to reach an average of €1,688 per square metre.

Gesvalt (based on valuations)

Costa del Sol property went up by 3.6% in the quarter, the highest rise in Spain, to reach €2,019 per square metre. The increase was the fifth-highest average price in the country and ahead of Barcelona province.

Sociedad de Tasación (based on valuations)

The Costa del Sol saw a price rise of almost 2%, the highest on Spain’s Mediterranean coast. Properties averaged €1,755 per square metre.

Fotocasa (based on asking prices)

The property portal reported that prices for property in Spain generally reversed their downward trend in November and have since climbed every month. In Q1, those for the Costa del Sol went up by 1.4%.

Malaga city prices in Q1

Malaga city appears to have taken the lead in price rises for Costa del Sol property this year, a position usually held by Marbella and Estepona. According to the Registrars Association, the city saw a year-on-year price hike of 13.6% in Q1 with the average square metre coming in at €2,190.

Tinsa reported that Malaga property saw the highest yearly increase in Andalusia. The valuations company said that prices rose by 5.1% in Q1.

Costa del Sol Property Sales in Q1 – 2021

Outside the capital, prices rose too. Figures published by Idealista and based on asking prices show that the Costa del Sol saw an increase of 3.9% in the year to April. This figure was considerably higher in several areas:

  • Benahavís– prices leapt by 11.6% to reach €3,404 per square metre.
  • Estepona– the increase was 6.3% to €2,348 per square metre.
  • Marbella– prices saw a more sedate rise (4.1%) to €3,156 per square metre.
  • Sotogrande– property went up by 4.3% to €2,384 per square metre.

Bottom line? After months of a downward trend, Costa del Sol prices have returned to an upward trajectory.

Costa del Sol new builds in Q1 – 2021

New-build sales increased their share of the market in Q1. According to the Registrars Association quarterly review, they represented 27% of the market in Q1, considerably more than the 15% and 10% seen in the two previous years.

Malaga city and the Costa del Sol currently have a buoyant new-build market. Tinsa figures show that the area issued 6.2 licences per 1,000 existing properties in 2020, almost double the national average (3.3).

Some 5,640 new builds should be completed this year in a total of 264 developments along the Costa del Sol. Malaga and Estepona take the lion’s share with 1,174 and 1,089 new homes, respectively. Mijas will see the third-highest number of completions with an expected total of 835.

Bottom line? The Costa del Sol has one of Spain’s largest markets for new builds, a situation that looks to remain steady in the immediate future.

In-store for the rest of 2021

As the figures in our Costa del Sol Property Market Review Q1 – 2021 , the Costa del Sol property market has started 2021 on excellent foundations. While sales and the number of foreign buyers have dropped, they remain strong.

This is particularly true for the new-build sector, currently, the main engine driving the market. New properties have surged in popularity among second-home buyers over the last 14 months, mainly because they offer more indoor and outdoor space than older properties. Having more room at home has become a priority for buyers the world over.

Prices too appear to have returned to an upward trend. However, there is a slight caveat – some analysts believe that resale property prices may continue to fluctuate down rather than up throughout the rest of the year. Much will depend on the vendor’s need to sell and the April figures from Idealista (based on vendors’ asking prices) certainly show that resale prices are not going down for the time being.

However, one factor is a given on the Costa del Sol despite the pandemic and travel restrictions – the area enjoys one of the finest climates in the world and has infrastructure and amenities to match. We, therefore, expect purchases of property in resorts such as Sotogrande and Estepona to climb steadily over the next few months reflecting pent-up demand.





Colegio de Registradores Q1 2021