Back to news
The Costa del Sol property market continues to remain strong June 2024
The Costa del Sol property market has remained robust up to June 2024, reflecting its continued appeal as a prime destination for both holiday homeowners and investors. This region, known for its stunning coastline, favorable climate, and vibrant cultural scene, has experienced steady growth in property values over recent years.
CURRENT MARKET TRENDS.
As of June 2024, the Costa del Sol property market exhibits several key trends.
Rising Demand
There is sustained high demand for properties, particularly in popular areas such as Marbella, Estepona, Benahavis, Fuengirola, and Benalmadena.
LIMITED INVENTORY.
The supply of available properties remains low, contributing to upward pressure on prices.
INTEREST RATE DYNAMICS.
Recent reductions in interest rates have made mortgage financing more attractive, further boosting demand.
PRICE TRENDS.
Property prices in the Costa del Sol have shown a consistent upward trajectory. In the first half of 2024, average property prices increased by approximately 5% compared to the same period in 2023. This growth is expected to continue, driven by both domestic and international buyers seeking investment opportunities and second homes.
FACTORS CONTRIBUTING TO PRICE INCREASES.
1. Lack of Inventory
Construction Bottlenecks. The Costa del Sol is experiencing delays in new construction projects due to regulatory hurdles and a shortage of skilled labor. This has significantly limited the number of new properties entering the market.
High occupancy rates.
Existing properties are seeing high occupancy rates, particularly in the rental market, which reduces the number of properties available for sale.
Land Scarcity.
Prime locations along the coast are limited, and the scarcity of land for new developments keeps supply constrained.
2. Falling interest rates and mortgage affordability
The European Central Bank's recent decision to lower interest rates has made borrowing cheaper. This reduction in borrowing costs has increased the affordability of mortgages, encouraging more buyers to enter the market.
3. Investor Attraction.
Lower interest rates enhance the appeal of property investment compared to other asset classes, attracting both local and international investors seeking higher returns.
4. Refinancing Activity.
Many current homeowners are taking advantage of lower rates to refinance their existing mortgages, freeing up capital to invest in additional properties or upgrade their current homes.
5. Future Outlook
The Costa del Sol property market is poised for continued growth over the next five years. Key factors influencing this outlook include:
6. Sustained Demand.
The region's enduring appeal to tourists, retirees, and investors ensures a steady stream of potential buyers.
7. Ongoing supply constraints.
With limited new developments expected to come online in the near future, the imbalance between supply and demand is likely to persist, further driving up prices.
8. Economic Stability.
As interest rates remain low and economic conditions stabilize, consumer confidence is expected to strengthen, supporting ongoing investment in the property market.
Conclusion
The Costa del Sol property market remains a vibrant and lucrative sector, characterized by rising prices driven by high demand, limited inventory, and favorable financing conditions. Prospective buyers and investors should anticipate continued price appreciation in the coming years, making now a strategic time to invest in this sought-after region.
For detailed insights and personalized advice, stakeholders are encouraged to consult with local real estate professionals Scmarbella and there mortgage advisors to navigate this dynamic market effectively and turn your dream into a reality.
Warm Regards
Ryan Golding
Head of Sales
