Real estate broker Juan Sanchez (surname changed by the editors) opens the door made of thick milk glass to the apartment, which was once a shop and where visitors enter from the street straight into the kitchen. The ceilings are very high. “You can put a suspended ceiling here,” says Sanchez. Two advertised bedrooms are in the basement. One of the small rooms doesn't even have a window.
– the whole can easily be hired for students for 1300 euro – says the broker. As he points out, however, there is a hook: “The space at the bottom is officially entered in the land and mortgage register only as a warehouse, so we did not get a license, but this is not a problem when renting.” This apartment with an area of ​​55 square meters in a centrally located middle class district in Madrid reportedly cost over EUR 300,000.
However, high prices are not the result of a low interest rate this time loansas was the case in 2005. They are currently driven by financially strong foreign investors who want to invest in a highly profitable and safe housing market in Spain and in a dynamically developing tourism industry. According to the Spanish BBVA bank, the supply is much smaller than demand.
As a result, many Spaniards have difficulty paying for rent, and numerous properties are temporarily rented to international tourists and students. As a result, the inhabitants of the Canary Islands, Barcelona and Madrid repeatedly go out into the streets to protest against the shortage of apartments and the influx of foreigners.
Apartment of apartments also driven by locals
Companies such as habitacion.com even offer rooms for sale. For the leftist lobby of Sindicatos de Inquilinas tenants, all this is related to wild speculation, especially by foreigners and investment funds. It is estimated that in a country of 46 million inhabitants there are over 4 million empty apartments and 400,000 holiday homes.
Apartment deficiencies on the market are also deepened by the residents themselves. According to the Spanish Statistical Institute of INE, there are over 2.5 million houses in Spain, which are used only sporadically. It can be assumed that a large part of them are the second or even third houses of Spanish families, which are also used for holiday purposes, but are usually not rented to third parties.
On the other hand, private investors and investment funds are less afraid of renting, and in particular, temporary contracts are becoming more and more popular among them. Excluding tourists renting, temporarily rented flats accounted for 14 percent of the entire market in the first quarter of 2025, which is an increase of 25 percent compared to the previous year – according to the Spanish Platform of Real Estate Idealista.
According to an idealist, cities such as Bilbao (36 percent), Alicante (33 percent), Barcelona (29 percent) and Madrid (23 %) recorded the largest increase in temporary housing offers. However, the Spanish minister for housing and urban planning, Isabel RodrÃguez, sent a signal in May: She informed the Airbnb platform that she would have to remove almost 66,000 housing offers without license, as reported newspaper El PaÃs.
In the future, thanks to the legislative initiative, the minister, each person spending their holidays in Spain, will have to pay 21 percent VAT for renting an apartment, i.e. twice as much as for a hotel room. The lobby of Sindicatos de Inquilinas tenants is not satisfied with this solution.
A dangerous bubble with social effects
Like before the financial crisis in 2008, the Spanish real estate market warms up again dangerously. The house, which in 2014, cost about 138,000 euros on average, in 2024 is worth 178 700 euros, according to MD Capital. In regions such as balearies, this price is even more than doubled. “It inevitably leads to protests among local people,” says a lawyer specializing in real estate in an interview with DW TIM Wirth. He believes that rental must become more attractive again: “in tax and legal terms secured for both parties.”
However, Wirth, working in Palma, sees serious social problems of the current situation. While Spanish real estate prices have increased by 29 to 34 percent in the last decade, the average salary increased only by just over 23 percent. In this way a gap was created, which – as MD Capital believes – hinders many Spaniards access to apartments.
Unlike Paris or London, in Spanish employees do not receive an allowance for remunerationwhen the prices of apartments are particularly high. Mean salary In Spain in 2024, according to the datosmacro macroeconomic portal, 2642 euros gross per month. Meanwhile, according to the Spanish real estate portal, an average apartment with an area of ​​80 square meters would cost around 1,100 euros per month. In cities such as Madrid or Barcelona, ​​the average price for such an apartment is already 1400-1500 euros.
Too many international tourists, too few social apartments
It is primarily about 90 million international tourists coming to Spain a year, digital nomads in the Canary Islands and Barcelona, ​​international students in Madrid and numerous investors from Latin America with large capital, who flood the Spanish market and thus cause more and more resistance, usually very friendly to Spanish foreigners.
According to the SPOTHOME internet platform, specializing in short and medium-term rentals in the academic year 2024–2025 over 118,000 students and lecturers from the Erasmus+program came to Spain. In addition, there are many international students from around the world who study at almost 90 universities and dozens of business schools in the country. Academics or student allowance (Bafög), like the German model, do not exist. This is one of the reasons why the Spaniards statistically leave the family home only after the age of 30 (Eurostat data from 2023). In Germany, however, young people are on average looking for their own apartment around 24 years of age.
In the field of social construction, Spain is far behind in Europe. According to official data, 14,371 social apartments were built last year. According to the data of the Spanish Ministry for Apartments, Spain allocated 34 euros per capita between 2007 and 2021 for social apartments. This is much less than the EU average of EUR 160, provides the internet information portal infobae.com.
The Sindicatos de Inquilinas storage lobby threatens with conflict if the government does not take strong action: “We will receive loud protests back what stands empty or is rented to tourists” – informs the lobby in an interview with DW.