Spain’s market for ultra-luxury real estate is led by Malaga and Costa del Sol.

A third of the high-end homes in the country are located in the province, and the vast majority of these properties are located in the so-called ‘golden triangle’, formed by Benahavís, Estepona and Marbella.

A third of Spain’s high-end homes are located in Malaga with Los Monteros, in Marbella, becoming the most expensive area to live in.

According to the luxury Spanish housing market report prepared by high-net-worth insurance company, Hiscox, there are 2,500 homes for sale for more than three million euros in the province. This represents 34% of the total Spanish super-luxury market and places Malaga in first place.

The vast majority of these properties are located in the so-called ‘golden triangle’, formed by Benahavís, Estepona and Marbella. Los Monteros, in Marbella, where the price per square metre reaches 6,842 euros, which translates into villas priced at up to 17 million euros, is the most expensive area to live in the province.

Lomas de Marbella-Puente Romano, with an average price of 6,173 euros per square metre and 35 million maximum price per home, is the second-most expensive area to live in Malaga.

Next in Spain, is the Balearic Islands, with 33% of the country’s total number of luxury homes for sale, then Madrid, with 10% and Barcelona, with 6%.

La Zagaleta, Puerto Banús and Finca Cortesín

Although it is not in the ‘top’ of the price ranking, the report pointed out the luxury residential development of La Zagaleta as “the most exclusive in Europe”. “It is located near the sea and nature, and has a wide range of services, from heliport or equestrian centre to services with nannies, cooks or drivers,” it said.

Its homes are valued at between three and 30 million euros, with an average price per square metre of 5,804 euros and an average size of 1,000 meters built. The homes in this area are mostly owned by foreigners from the United Kingdom, Germany, Scandinavia, Russia and Arabia.

Other areas in Marbella are also mentioned in the report, such as Puerto Banús, with a square metre price of 5,240 euros and a maximum price of 15 million euros per property, and Las Brisas, with an average value of 5,140 euros per square metre and a maximum price of 14 million euros.

The report also pointed out the lesser-known area of Finca Cortesin, located in Casares, between Sotogrande and Marbella. “Voted for several years as the best golf resort in Europe, this 215-hectare development has a large luxury hotel and exclusive private villas next to the golf course, with 24-hour services available to owners,” the report said.

“The province of Malaga has positioned itself as a luxury destination, thanks in part to the good air connectivity it has with the rest of Europe, with direct connections to 48 cities outside Europe and almost a hundred European cities, the main supplier of foreign buyers of luxury homes in our country,” the report added.

Marbella and Benahavís are the most sought-after areas in for luxury steal estate in Malaga province. Within these two municipalities, the best locations include Marbella’s Golden Mile and the La Zagaleta development. However, there are other high value areas such as in Marbella’s Lomas de Marbella, Puente Romano, Lomas de Río Verde, Puerto Banús, Las Brisas and Los Monteros, and in Benahavís El Madroñal.

At the end of 2022, homes over three million euros accounted for just over 3.5% (almost 2,900 homes) of the total number of real estate sales in Marbella and Benahavís. This figure represents a sharp increase compared to 2021, when 1,800 properties were sold, representing around 2% of the total. As for the current ‘stock’, homes over three million euros represent 6% of the total in Marbella and Benahavís.

From second to first residence

The study details a ‘mix’ of buyers in Marbella: “mainly the wealthiest Madrid residents; followed by the British, who despite Brexit have remained loyal to this municipality and represent 20% of purchases by foreigners; as well as the French and northern Europeans”.

Among Madrid buyers there is a clear trend following the Covid-19 pandemic: “Before, these buyers spent their holidays and many weekends a year in Marbella. Now, however, many have established their primary residence in Marbella and only travel to Madrid occasionally for business meetings”.

The study pointed out that after the pandemic, “new behaviours have become widespread in terms of the use of two or three residences, or even more”. “With teleworking becoming more and more normalised, it is becoming relatively common among the ultra-rich to have residences in several destinations around the world where they can go seasonally. Mobility and adaptability are now their new watchwords,” the report added.

Spain, fourth country in the luxury housing market

“The luxury real estate market in Spain is experiencing considerable growth, and more high-net-worth individuals are deciding to invest in it,” said Eva Peribáñez, director of the Art and Private Clients division of Hiscox Spain. Prices in the country’s luxury real estate market have increased by 10-20% in the past two years, and the insurer believes that they will remain stable in the future.

Spain currently ranks as the fourth country in the world (after the US, UK and Australia) where UHNWI (Ultra High Net Worth Individuals, those with wealth in excess of $30 million) buyers invest the most. “The results of the report support our perception of a notable increase in this type of client in Spain. And this is accompanied by a generational change, since in just a few years, in 2025, millennials and generation Z will already represent 60% of the luxury market,” said David Heras, general manager of Hiscox Spain.

Hiscox expects luxury real estate to continue to boom. “Due to the lower need for financing on the part of buyers, interest rate rises are not affecting the average price of luxury housing for the moment, nor are they slowing down interest in buying, given that a large number of transactions are carried out without the need to resort to financing,” the report explained.

“As for the economic scenario in which we find ourselves, where various experts are predicting a new period of economic recession, exclusive homes are becoming more attractive as an investment due to their quality of refuge value and where we will see people with high purchasing power taking defensive positions by acquiring luxury residential properties in certain locations.”

Source: SUR in English, July 2023