Rental prices in Spain surged by 11.5% in 2024, marking the highest annual increase on record, according to a report by Idealista, one of Spain’s leading real estate platforms. The sharp rise reflects mounting challenges in the nation’s housing market, where demand continues to outstrip supply.
New Record Average: €12.2 Per Square Meter
The national average monthly rent now stands at €12.2 per square meter, the highest figure ever recorded by Idealista. The upward trend was observed across nearly all regions, underscoring widespread affordability concerns for tenants.
31 Spanish Capitals Hit Record Rental Prices in 2024
A total of 31 Spanish provincial capitals recorded their highest-ever rental prices during the final quarter of 2024. All capitals experienced higher rental costs compared to December 2023, with the sole exception of Lleida, where prices decreased by 2.2%. Ávila led the annual growth in rents, with an 18.6% increase, followed by Madrid (+15.3%), Guadalajara (+14.4%), Oviedo (+14.4%), and Barcelona (+13.9%).
Among other major markets, notable annual increases were observed in Valencia (+12.2%), Palma (+11.9%), Málaga (+11.4%), and Alicante (+10.2%). More moderate rises occurred in Sevilla (+9.5%), Bilbao (+9.2%), and San Sebastián (+7.2%).
Barcelona remains the most expensive city in Spain for renting, with an average price of €23.4 per square meter, followed by Madrid (€20.7/m²) and San Sebastián (€18/m²).
Palma ranks fourth (€17.2/m²), while Málaga secures fifth place (€15.1/m²). On the other end of the spectrum, Zamora has the lowest rental prices (€6.7/m²), followed by Ciudad Real (€6.8/m²) and Lugo (€7.3/m²). Other affordable markets include Cáceres, Ourense, Badajoz, Teruel, and Jaén, all averaging €7.5 per square meter.
Drivers of Rising Prices
The Idealista report highlights several factors contributing to the surge in rental prices:
- High Demand: Urban centers and tourist-heavy areas continue to attract both domestic and international renters.
- Limited Supply: A shortage of available rental properties has intensified competition, pushing prices upward.
- Economic Pressures: Rising interest rates and inflation have made homeownership less accessible, forcing more people to seek rental options.
- Short-Term Rentals: The prevalence of short-term rental platforms has further reduced long-term rental availability, especially in major cities and vacation hotspots.
Policy Interventions Show Mixed Results
Despite government efforts to regulate rental markets, such as rent caps in designated high-demand areas, the measures have had limited impact in curbing price increases. Critics argue that these regulations discourage property owners from entering the long-term rental market, exacerbating the supply shortage.
In cities like Barcelona, where rent control policies have been implemented, landlords have increasingly shifted properties to short-term rentals or taken them off the market entirely, further tightening the market.
Outlook for 2025
As Spain moves into 2025, the housing market remains a key concern for policymakers, tenants, and property owners. Analysts predict continued price pressures, particularly in high-demand regions, unless substantial measures are taken to address structural issues in the market.
The Idealista report underscores the need for balanced solutions that ensure housing accessibility while maintaining incentives for property owners. For now, renters in Spain face the dual challenge of navigating a competitive market and managing rising costs.