Always a favourite among foreign buyers, the Costa del Sol has never been more popular. Non-Spanish buyers currently account for the majority and in some parts, the figure exceeds 90%. The so-called Golden Triangle ranks as a particular favourite and within the trio of Marbella, Benahavis and Estepona, the Marbella property market stands out as the overall preferred destination.
Ricardo Arranz, President of the Andalusian Federation of Developers and Residential Tourism (FAUTR), highlights the consolidation of the market. “Malaga and the province are very much in vogue,” he said, emphasizing that most buyers are foreign.
According to FAUTR statistics, Scandinavian and British clients make up the majority as they discover “the quality of the climate, infrastructure and security”. Arranz also underlined the “warm welcome” foreigners can expect to receive, a factor appreciated by US buyers, also prevalent on the Costa del Sol.
The appeal of the Golden Triangle
The Golden Triangle, encompassing the Benahavis, Estepona and Marbella property markets, ranks as the most sought-after area for foreigners to buy. Luxury real estate as an investment or second home is a particular magnet.
Foreigners look for “quality over quantity,” according to Arranz and the average price paid ranges from €2 million to over €20 million. Along with the sunshine and infrastructure, international buyers also value the golf courses on the Costa del Sol.
Hotel brands partner with development
The FAUTR also highlights the presence of recognised hotel brands that partner with the development of integrated apartments on the Costa del Sol. Arranz says that this combination gives complexes security and additional services, which, in turn, allows buyers extra security on return from the investment.
Luxury brands have increased their association with property development in Marbella and Estepona over the last few years. Two examples include Fendi and Karl Lagerfeld, both linked to high-end villas on the Marbella property market.
Supply behind demand
Although councils from all three components of the Golden Triangle have improved their planning paperwork in recent years to facilitate new development, supply remains well below demand. According to one of Spain’s leading developers, AEDAS Homes, inventory levels of new homes satisfy just 56% of demand from foreigners, locals and other Spanish investors.
The most sought-after areas are those within the Golden Triangle, as well as Fuengirola and Rincón de la Victoria, further east on the Costa del Sol. Properties in close proximity to a golf course remain among the most desired homes.
In tandem with this demand go rental increases. According to the latest figures from the property portal Idealista, monthly rates went up on the Costa del Sol by 22.8% in the year to February.
All resorts on the Costa del Sol saw rents skyrocket, with Estepona rentals leading the country. In this town, rates rose by 40.8% in 12 months, the highest in Spain, to reach €14.77 per square metre. Rentals within the Marbella property market also rose sharply, and their 20.2% increase brought square metre prices to an average of €15.56.
(Sources: FAUTR, Idealista)