Spanish Property Market Reaches Unprecedented Highs
According to the latest data from the Fotocasa Real Estate Index, a significant milestone was reached in July 2025. Five Spanish regions—Andalusia, the Balearic Islands, the Canary Islands, the Valencian Community, and Madrid—have now surpassed the maximum price for second-hand home purchases set during the peak of the property bubble. This signals a market that has not only recovered but has entered entirely new territory.
A Nationwide Trend With the Canaries Leading the Way
María Matos, Director of Studies and Spokesperson for Fotocasa, provided a telling forecast: “If the current rate of price increases continues, the entire country will likely reach new record highs next year.” The Balearic Islands have been at the forefront of this surge, having exceeded their bubble-era peak for over two consecutive years. In a striking comparison, the average price per square meter in July 2025 stands at €5,069—a massive 84% increase from its previous high of €2,762 in April 2007.
Canary Islands: Two Years of Record-Breaking Prices
For prospective homeowners and investors in the Canary Islands, the market is hotter than ever. Mirroring the Balearic trend, the archipelago has also been breaking its own price records for more than two years, definitively leaving the 2007 bubble in its wake. The current average price is a formidable 47% higher than during the previous boom. To put this into perspective, the average price per square meter in May 2007 was €2,155. Today, that figure has climbed to €3,157, reflecting the intense demand and limited supply in this sought-after destination.
Other Regions Follow Suit
This upward trend is not isolated to the islands. The Community of Madrid has surpassed its January 2007 peak by 22%, with prices jumping from €3,970 to €4,858 per square meter. Andalusia recently exceeded its April 2007 maximum, with July 2025 prices coming in 4% higher at €2,610. Similarly, the Valencian Community has just edged past its April 2007 record. Although the increase is a modest 0.2%, it marks the first time the region has hit €2,436 per square meter, up from €2,430.
Provincial Capitals Hit New Peaks
The price surge is particularly concentrated in urban centers. A total of 11 provincial capitals reached their own individual price ceilings at some point in 2025. This list includes major cities and tourist hubs such as Málaga, Alicante, Valencia, A Coruña, Madrid, San Sebastián, and Palma de Mallorca. Significantly for the Canaries, both Santa Cruz de Tenerife and Las Palmas de Gran Canaria are also on this list, highlighting the widespread growth across the archipelago’s main urban areas.
Housing Accessibility at a Critical Point
The report concludes with a cautionary note from spokesperson María Matos, pointing to a growing challenge for the market. “Housing accessibility is now at risk because the proportion of salary that buyers must dedicate to a purchase is at its highest point ever. As long as supply does not increase, this upward pressure on prices will persist.” This creates a complex scenario for residents and a competitive investment landscape for those looking at the Canary Islands’ property market.
