International buyers are becoming an increasingly important part of Spain's residential property market. During the third quarter of 2026, foreign nationals accounted for 16.05% of all registered home purchases, the highest proportion recorded in the available historical series.

At the same time, property prices reached new highs, creating a market in which international demand remains significant despite a decline in overall transactions. The figures reveal a more complicated situation than a simple housing boom.

Foreign Buyers Reach a New Market Record

More than 26,300 Spanish property purchases were registered by foreign nationals between July and September 2026. Their 16.05% share exceeded the previous quarter's 15.98%, establishing a new record. European Union citizens represented 54.7% of foreign purchases, while buyers from other European countries accounted for another 17.8%. By nationality, British purchasers represented 7.5% of foreign transactions, followed by Moroccan buyers at 6.4% and Dutch buyers at 5.8%.

International demand was particularly concentrated in coastal and island destinations. Foreign nationals accounted for 37.2% of purchases in the Balearic Islands and 30.4% in the Valencian Community. The Canary Islands also recorded a substantial proportion, at 25.4%.

Property Prices Continue to Set Records

Housing values increased considerably during the third quarter. The repeat-sales house price index rose 15.8% compared with the same period in 2025 and 5.2% compared with the previous quarter, reaching a new historical high. The average registered price reached €2,512 per square metre. Existing properties averaged €2,462, while newly built homes reached €2,701 per square metre.

Prices varied significantly by location. The Community of Madrid recorded an average of €4,565 per square metre, closely followed by the Balearic Islands at €4,502. The Basque Country, Catalonia, and the Canary Islands also recorded relatively high averages. The repeat-sales index and average transaction price measure the market differently. The former tracks price changes for properties sold more than once, while the latter can be influenced by the types of homes sold during a particular period.

Fewer Transactions Reveal Signs of a Slower Market

Despite rising prices, overall residential activity weakened. Spain recorded 164,148 home sales during the third quarter, a decline of 5.9% compared with the previous year and 2.3% compared with the preceding quarter. This represented the third consecutive quarterly decline and the lowest transaction volume in nine quarters.

Existing properties accounted for most sales, with 129,537 transactions, while newly built homes generated 34,611. Both segments experienced quarterly decreases. Mortgage registrations also declined. A total of 124,145 home mortgages were recorded, 3.9% fewer than in the second quarter. Nevertheless, the twelve-month total remained positive, reaching 519,388 mortgages, an increase of 6% compared with the preceding twelve-month period.

Why International Demand Matters

Foreign purchasers contribute to demand in several parts of Spain, particularly destinations with established tourism industries and international communities. Their motivations can include permanent relocation, retirement, second-home ownership, and long-term property investment.

However, a rising foreign-buyer share does not necessarily mean that international purchases are increasing rapidly in absolute terms. The proportion can rise when domestic or overall transactions decline faster. In this quarter, the foreign-buyer share increased slightly even though the number of foreign purchases was lower than in the preceding quarter.

Housing supply is another important consideration. Research by BBVA Research identifies insufficient housing availability as a major factor behind rising prices and declining transactions. When new construction and existing homes entering the market cannot keep pace with household demand, competition for available properties intensifies.

Expert Insight

Javier Díaz-Giménez, an economist at IESE Business School, discussed the relationship between housing supply and prices in an interview reported by Reuters. He stated: “there is little reason to expect prices to stop rising yet.”

Spain's housing market reached an important milestone in the third quarter of 2026, with foreign nationals accounting for a record 16.05% of registered home purchases. International demand was especially strong in the Balearic Islands and Valencian Community, while national property prices also reached new highs.

However, declining sales and mortgage registrations indicate that market activity is losing momentum. The growing share of foreign buyers should therefore be understood alongside the broader slowdown rather than as evidence of uninterrupted expansion. Housing availability, affordability, and financing conditions will remain important factors shaping Spain's residential propert