Spain’s housing market ended 2025 with exceptionally high levels of activity, exceeding 714,000 transactions, the highest figure since 2007. The strength of demand – driven by population growth, improved purchasing power and favourable financial conditions – sustained high activity, particularly in the first half of the year. However, on the supply side, significant limitations persist: despite the increase in permits, the construction of new homes remains insufficient to keep up with new household creation. This imbalance between supply and demand is exerting significant upward pressure on prices, which are accelerating across the board, particularly in the most dynamic and touristic areas. Looking ahead to 2026-2027, transactions are expected to stabilise at high levels and there will be a gradual improvement in supply, although it will remain insufficient. As such, prices will continue to rise, albeit at a more moderate rate.
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Luxury tourism has established itself as a strategic segment for the Spanish tourism sector, both for its high contribution to expenditure and for its potential to increase the value added of the sector. According to payment data analysed by CaixaBank Research, although this segment only represents 3% of international cards, it accounts for 20% of in-person spending by foreign tourists. The analysis also highlights the rise of urban luxury tourism, driven largely by Madrid’s dynamism as a high-end destination, despite luxury tourism still maintaining a strong coastal orientation. The United Kingdom, France and Germany are the main sources of tourists travelling to Spain, both in the luxury and conventional segments, although other economies with a very high GDP per capita, great inequality or a combination of both stand out.
The restrictions put in place to curb the spread of the coronavirus and caution due to the prevailing uncertainty led to a large increase in savings by Spanish households in 2020. Specifically, we estimate that cumulative savings from the pandemic reached €46.6 billion, 3.7% of 2019’s GDP. This sharp increase in savings has diminished as we have been able to return to our old habits, leading to a rapid recovery in consumption; a trend that will most likely continue in the coming quarters.
In recent years, rural tourism has become increasingly important in Spain, opening up new avenues to diversify the sources of income for rural economies. In this article, based on internal CaixaBank data, we look at the upturn in the sector after the COVID-19 pandemic and its implications for the economic resilience of rural Spain and for the tourism industry, given its high level of sustainability both from the point of view of its impact on the environment and its greater geographic diversification and more limited seasonality compared to other, more traditional forms of tourism such as sun, sea and sand destinations.
Valuations of commercial real estate assets recovered significantly during 2024, driven by the shift in monetary policy and the reduction of market interest rates. Investment in the sector grew at an annual rate of around 20% and the living, hotel and retail segments were particularly dynamic. For 2025, it appears that most of the revaluations will have already taken place, as interest rates are already at levels close to the new equilibrium. Still, the sector will continue to attract investment opportunities. Spain is positioning itself among the most attractive destinations for international investment in commercial real estate, thanks to solid macroeconomic fundamentals that will remain attractive throughout this year.
International tourism tends to be the main focus of attention when we talk about Spain’s tourism industry. However, domestic tourism also plays an important role: Spaniards travel more than 175 million times a year within Spain and generate an associated tourist expenditure of 30,000 million euros1. In this article, we examine the recent trends in Spain’s domestic tourism and discuss the main differences between domestic and international tourists.
- 1A trip is considered to be any journey made to a main destination outside the person’s customary zone of residence that entails at least one overnight stay outside this zone.
The catering sector is continuing its good streak in 2025, with solid growth in spending thanks to the boost from both national and international tourism. Although the pace of growth has moderated compared to previous years, the data show a clear resilience, even after the power blackout on 28 April, which dealt a temporary blow to the sector’s turnover.
The population over 65 years of age is consolidating itself as a strategic segment of the Spanish tourism sector, with ample room for expansion. The demographic weight of this group has grown steadily in Spain and its purchasing power now exceeds the national average, reinforcing its strategic importance. Analysis of CaixaBank’s card payment data confirms that this group represents a significant part of tourist spending, particularly for domestic tourism. However, their share remains lower than their weight within the population, which suggests considerable growth potential if the supply is better adapted to their preferences and needs. Furthermore, this group acquires special importance in rural provinces and contributes to deseasonalisation.
Since Spain’s tourism sector returned in 2023 to the peak levels of 2019, the sector has been showing no signs of cyclical exhaustion and it recorded strong growth in 2024.
It is inevitable that the property development and construction sectors, which are very sensitive to economic conditions and confidence levels, will contract significantly this year. We expect a notable decline in new building permits and a severe impact on employment in the construction industry. However, the nature of the shock and the state of the sector before the appearance of COVID-19, much more favourable than a decade ago, suggest it should be able to recover.
Given the dramatic decline in demand, house prices are likely to undergo some adjustment in the period 2020-2021, although there will be significant differences depending on the property's location and type. Specifically, we expect house prices to fall more sharply in the second-hand market and tourist areas, which have been severely affected by the restrictions on international travel.
The supply of housing continues to be insufficient to absorb demand, which continues to grow strongly due to the formation of new households. This housing deficit and the pressure it exerts on prices underscores the need to accelerate the construction of affordable housing.
Between 2018 and 2024, the Spanish economy experienced a substantial improvement in its relative electricity and gas prices, going from paying more than the European average to benefiting from lower rates. This decline is a result of the significant growth of solar photovoltaic and onshore wind power, the two forms of electricity generation with the lowest cost. Lower electricity prices compared to European competitors have facilitated the manufacturing sector’s good performance in recent years. This advantage in the generation of sustainable and low-cost electricity gives Spain’s industry a competitive edge over its competitors.
The COVID-19 pandemic has highlighted the importance of the agrifood sector as a mainstay of the Spanish economy. During the months of lockdown, the entire food chain (which includes farmers, breeders, fishermen, cooperatives and the food industry, wholesalers, retailers, distributors and logistics operators) had to adapt quickly to secure the population's food supply. In retrospect, it is only fair to acknowledge the excellent response by the whole sector in tackling this challenge.
Europe’s economic response to the COVID-19 crisis took shape in July: the European Council approved the Recovery Plan for Europe, the so-called NGEU, via which the European Union will grant up to 750 billion euros to its member states to stimulate their economic recovery after the shock of the pandemic. This is an unprecedented agreement and it could have a considerable impact on Europe’s real estate sector since one of the EU’s main goals, to which this Recovery Plan aims to contribute significantly, is to reduce greenhouse gas emissions by 55% by 2030 compared with 1990 levels. It is clear that renovating Europe’s buildings, which are responsible for 40% of the continent’s energy consumption, will be key to achieving this climate target.
The outbreak of war in Ukraine has overshadowed the positive outlook we were forecasting for the Spanish economy in 2022. While, at the end of last year, some factors had already appeared on the scene that hindered the economic recovery, the armed conflict in Ukraine has become the main focus of attention and the major conditioning factor for short-term economic developments.
In 2024, the Spanish economy has exhibited widespread growth across virtually all of its sectors: the number of sectors in a situation of weakness has reduced, while that of sectors in expansion has increased, following the gradual absorption of the major shocks that affected their performance in recent years.
The spread of the coronavirus throughout the world has come as an unprecedented shock to the global economy. The Spanish economy has been particularly hard hit, partly because of its greater dependence on international tourism. In the second half of the year, we expect the economic recovery to take hold thanks to the easing of social distancing measures and the boost provided by the wide range of fiscal and monetary measures adopted. However, we believe the economy will continue to operate below potential over the next few years.
The situation of the tourism sector improved considerably during the summer months, outperforming the projections of many of the companies in the industry.