The Spanish residential real estate market closed the first half of 2026 with an increasingly clear picture: prices continue to rise, home sales are losing some momentum and supply remains insufficient to absorb existing demand.
This is one of the main conclusions of Urbanitae’s new quarterly report on the residential sector in Spain, which analyses the evolution of housing during the first half of the year and the outlook for the second half.
The context is more complex than in 2025. Geopolitical uncertainty, the evolution of inflation and the behaviour of Euribor have introduced more caution into the market. Even so, the Spanish economy maintains a positive tone compared with other European economies, supported by employment, population growth and the dynamism of the services and tourism sectors.
Rising prices, but with signs of moderation
Housing continued to become more expensive during the first half of the year. According to Tinsa, the average value of completed housing — new and existing — reached 2,066 euros per square metre in the second quarter of 2026, after growing by 15.2% year-on-year and 3.7% quarter-on-quarter.
New-build housing also maintained its upward trend. The national average price reached 3,458 euros per square metre at the end of June, 9.7% higher than a year earlier, according to Grupo ST. With this figure, new housing recorded its fifth consecutive semester at all-time highs.
In the existing-home market, Fotocasa reports a cumulative increase of 8.2% between January and June, reaching 3,133 euros per square metre. In practical terms, an 80-square-metre home went from costing 231,744 euros at the start of the year to 250,673 euros in June: almost 19,000 euros more in six months.
However, the report also points to a possible gradual loss of momentum. Prices continue to rise because supply remains scarce, but the strong accumulated price increase and the cost of financing are beginning to limit the purchasing power of some households.
Home sales lose momentum
Activity remains at high levels, but is no longer growing with the same intensity. According to the INE, June broke a streak of five consecutive months of declines, with 59,288 home sales, 1.6% more than in the same month of 2025 and the best figure for a June since 2007.
June’s positive figure does not, for now, change the trend for the semester. Between January and June, home sales accumulated a 2.6% decline compared with the same period of the previous year, with decreases in both new and existing housing.
Registrars point in the same direction: during the second quarter, 167,934 home sales were recorded, 5.7% fewer than in the previous quarter and 2.3% fewer than a year earlier. This was the second consecutive quarterly decline and the lowest volume of transactions in the last seven quarters.
Foreign demand, by contrast, continues to gain weight. In the second quarter, it accounted for 15.98% of home sales, the highest level in the historical series, with a particularly strong presence in the Balearic Islands and the Valencian Community, where it exceeded 30% of the total.
Rental prices stabilise, but do not ease
The rental market followed a different path. According to Fotocasa, the average price rose by just 0.1% between March and June, the smallest increase for this period since 2007. In year-on-year terms, rents rose by 2.9%, reaching 14.79 euros per square metre per month.
This moderation does not imply a generalised fall or a clear improvement in affordability. Rather, it reflects the fact that households’ economic capacity is reaching a limit in many markets. Demand remains high, but it cannot always absorb further increases.
In addition, the stability of the national average hides strong territorial differences. The Community of Madrid remains the most expensive region, at 21.95 euros per square metre per month, followed by the Balearic Islands, Catalonia and the Basque Country. At the other end, Jaén and Badajoz remain the provinces with the lowest rents.
An access problem, not a lack of demand
One of the report’s central ideas is that the market is not facing a real estate crisis in the classic sense, but rather an affordability crisis.
Diego Bestard, CEO of Urbanitae, summarises it as follows in his analysis included in the report: “We are not facing a real estate crisis, but rather an affordability crisis within a market whose fundamentals remain solid.”
The distinction is important. In 2008, the market was marked by excess construction, higher leverage and supply that did not always respond to real demand. Today, the opposite is happening: Spain creates around 220,000 households per year, while housing production remains below the real needs of the market.
The accumulated deficit now stands at around 730,000 homes, according to the report. And although new-build permits are improving, with forecasts of around 153,000 housing starts in 2026, the figure remains insufficient to close the gap.
Supply, the major unresolved challenge
The 2026–2030 State Housing Plan, endowed with 7 billion euros in state funding plus regional co-financing, represents progress in the right direction. So do some regional reforms aimed at simplifying procedures, promoting industrialisation or increasing housing availability.
But the scale of the challenge remains enormous. CaixaBank Research estimates that the deficit could reach around 922,000 homes in 2029 and still remain close to 905,000 units in 2030. To absorb the accumulated deficit, it would be necessary to produce around 330,000 homes per year over the next five years.
Until this happens, the scarcity of supply will continue to support prices, even in a context of less dynamic home sales.
Second half of 2026: less activity, prices still under pressure
Looking ahead to the second half of the year, the most likely scenario is one of gradual deceleration, not a sharp correction. Fewer transactions, more selective buyers and more moderate price increases can be expected, but not a generalised fall in valuations.
The rental market will continue to concentrate much of the pressure, as many households that cannot access home ownership remain in the rental market. At the same time, professional capital continues to show interest in residential: the living segment attracted more than 4.5 billion euros in the first half of the year, twice as much as a year earlier and 38% of all real estate investment, according to CBRE.
As Diego Bestard points out, “the market does not need incentives to create more demand; it needs capacity to generate supply.” More ready-to-build land, faster procedures, more efficient construction and appropriate financing structures will be key to responding to one of the country’s main economic and social challenges.
Urbanitae’s full report explores all these figures in greater depth, analyses the evolution by territory and includes the outlook for the second half of 2026. You can download it here.
https://blog.urbanitae.com/wp-content/uploads/2026/09/informe_vivienda_2026_q2_urbanitae_en.pdf
See previous editions of the report:
