THE Spanish property market continued to lose momentum in the first half of 2026, with foreign buyers leading the decline, according to the latest figures from Spain’s Housing Ministry.
But there are also signs that the slowdown might be easing, lending weight to the idea that the market is heading for a soft landing.
There were 353,557 home sales in Spain in the first half of the year, down 7% compared to the same period last year. Foreign buyers purchased 57,595 homes, a decline of 12.6%, whilst purchases by Spaniards fell by a more modest 6%.
The sharpest decline was among foreign non-residents, who mainly buy holiday homes and second homes rather than somewhere to live permanently. They bought 22,610 properties, down 17% on last year.
Foreign residents, or expats, bought 34,985, down almost 10%.
So foreign demand is weakening significantly faster than domestic demand, with holiday-home buyers leading the retreat.
That is hardly surprising given how much Spanish house prices have risen, and the economic and political uncertainties facing potential buyers.
The slowdown was widespread across the regions popular with foreign buyers, though some fared better than others.
Purchases by foreign non-residents fell 14% in Andalusia, home to the Costa del Sol, and 24% in Catalonia, with double-digit declines in the other major coastal and island markets.
Madrid recorded a 44% fall, though its relatively small holiday-home market makes that figure less significant than it looks.
There was, however, some encouraging news in the second quarter. Foreign demand fell by 10.7% compared with the same period last year, an improvement on the 14.6% decline recorded in Q1.
In Andalusia, non-resident purchases fell by just 2% in Q2, suggesting that demand in the Costa del Sol market might be stabilising.
So whilst foreign buyers are still pulling back, the rate of decline eased as the year progressed. Whether that signals a more encouraging trend in the second half remains to be seen.
It is also worth remembering that 2025 was the strongest year on record for Spanish home sales, and the first half of 2026 was still the second strongest. These are hardly the figures of a market in crisis.
My view is that buyers are increasingly pushing back against prices that have risen too far, too fast. A chronic housing shortage should help support prices, but it cannot force buyers to pay more than they can afford or are willing to spend.
For now, the overall picture looks more like a slowdown than a slump, perhaps even the beginnings of a soft landing after years of exceptionally strong demand.
And with the second quarter looking better than the first, there is at least some reason to hope that the second half of the year will bring an improvement. We’ll have to wait and see.
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