The resuscitation of the Spanish real estate market over the past 6 years has been largely the result of foreign investment. Although Spanish buyers are also highly present in the main tourist areas of the country, international investors have strengthened their positions in several key markets. Thus, Costa del Sol (Malaga) and Costa Tropical (Granada) are notable for the strong presence of foreign property owners.
Costa del Sol is one of the top Spanish tourist destinations with a higher percentage of foreign investors who come over to buy a property. Different estimates state that more than 50% of the properties of the Malaga coast are in the hands of international owners (some sources claim this figure is even higher). Among the main reasons for this trend are historical and economic reasons. It should not be forgotten that Costa del Sol was one of the first to gain external visibility when the Spanish economy soared in the 60s. As for financial motivations, the area remains comparatively more affordable than other southern regions in Europe.
The most present nationality on the coast of Malaga remains the British, confirming that ‘Brexit’ has not yet affected the purchasing power of visitors arriving from the British Isles. The exchange rate still benefits the pound sterling in spite of its fall since London started the procedures to leave the European Union. They are a loyal group, with strong roots in the area and with properties that have been in the hands of the same family for several decades.
The Russians are also part of the picture in Costa del Sol and, again, this has surprised more than one analyst. After the EU’s approval of imposing different sanctions on Moscow in 2014, there was a fear of decline in Russian participation in the real estate market in southern Andalusia. In addition, the Russian economy itself has gone through several years of recession. In any case, the Russian investment has weathered the storm and continues to opt for very exclusive and large properties. A third group to highlight would be the French, who are estimated to have a share of 10% in this market.
For its part, Costa Tropical has a growth potential that’s said to be much higher than its neighbour, Malaga. The adjustment in real estate prices has been more pronounced than on Costa del Sol and this offers the best opportunities for investment in high quality properties. Almuñécar is in the locality of Granada and is seeing positive results. This in turn anticipates an upcoming rise in property prices. Among the nationalities most interested in Costa Tropical, the British are the leading group, surpassing the total number of the other three groups of foreigners. According to recent INE data, the second place are the Germans who are slightly ahead of the French and Russians.
