It's a Global Market

Foreign buyers are often blamed for Spain’s housing shortage. The data suggests the picture is far more complex. The fact is the overseas property sector has a long history in Spain but it was largely the preserve of the wealthy seeking a summer-only destination; most properties were locked up in winter. It took the growth of tourism from the mid-1960s, the development of the golfing sector from the 1970s, and the appearance of low-cost airlines in the 1990s for it to go mainstream. The British dominated the overseas sector, with as much as an 80% market share at one time, until a wider range of nationalities started to enter the market in the late 1990s. Finally, in 2007, the Notaries started counting foreign buyers by nationality, but until then, all we knew was there were lots and lots of Brits. Even as the British share of a much larger cake was diminishing, they still accounted for one in every three foreign purchases, and they have topped the league table every year since 2007, although now it’s by their fingertips.

The Nationality League Table

What really stands out about the nationality statistics now is just how much some markets have expanded in the years since the data was first collected in 2007. For example, in that year, there were just 1,003 German buyers and only 330 from the U.S. In 2025, there were 9,900 Germans and just under 3,000 US buyers. In terms of property investment by overseas buyers, Spain is now a global market.

I keep expecting to see the British knocked off the top spot they are hanging in there. The nationality breakdown for 2025 has them in 1st place, with 12,080 purchases, 8.3% of all foreign buyers. So far, so normal, but there are big changes happening lower down the league table. In previous years, I would have expected to see either the French or Germans in the next two spots; they switched around on a regular basis but not any more, it seems. Buyers from Morocco took 2nd place and 7.8% foreign market share, Italians 3rd with 10,641, pushing the Germans down to 4th place and Romanians 5th. However, when you dig a bit deeper into the facts behind the raw figures, particularly as regards spending power, a rather different league table emerges. A buyer from Morocco or Colombia isn’t the same as a buyer from the US or Sweden. And there is also a noticeable difference between the average spend of foreigners resident in Spain and non-residents. 

Residents & Non-Residents

Foreign property buyers in Spain fall into one of two groups, those classed as fiscally resident because they spend more than 182 days a year in Spain and those that don’t, the non-resident second-home buyer. This is an important distinction because buyers from overseas have always spent more than domestic buyers while foreign non-resident buyers always spend more than resident foreigners. On average, overseas buyers spent €2,550 per square metre in 2025, 34% more than the domestic average of €1,909 pm². However, when overseas buyers are separated into resident and non-resident groups, there’s a big difference; foreign residents are only 5.7% ahead of the domestic average, while non-resident foreigners outspend domestic buyers by 73%. 

The High Spenders

In the case of the nationality league leaders, the British non-resident buyer is spending an average €2,795 pm², up 12.3% year-on-year, while resident Brits average spend pm² rose only 1.6% to €2,442 in the same period.  Buyers from the US represent only 2.2% of the overseas sector of Spain’s property market, but they have an average spend of €3,465 per square metre, 92% higher than the domestic average, which rises to €3,697 pm² for non-resident US buyers. However, they were knocked off the top spot by Chinese non-resident buyers spending an average €4,116 pm2, but 85% of all Chinese buyers are resident, spending approximately half of that figure - €2,081 pm². And at the other end of the spending league table? That would be the Moroccans stuck firmly at the bottom with an average spend pm² of only €747. 

The Low Spenders

Those nationalities who are overwhelmingly resident in Spain dominate the league of low spenders, well below the average spend of domestic buyers. For example, over 98% of Moroccan buyers are resident in Spain. The economic migrant groups, such as Moroccans, Romanians, Bulgarians, Colombians, and Ecuadorians, are not competing with the higher spending foreign buyers on the Mediterranean coasts and on the islands. They are buying in urban areas in towns and cities and in rural locations, and if anyone is competing with domestic buyers for scarce product, it is this low spending group.

At the start of 2025, the current Spanish government discussed bringing forward legislation to ban all non-EU, non-resident buyers from the property market, which, apparently, would solve Spain’s housing shortage.  However, restrictions aimed at foreign buyers may have limited impact on overall affordability if supply remains constrained. Taking the average domestic spend of €1,804 pm2, it’s clear that overseas non-resident buyers, with an average spend of €3,465 pm², irrespective of whether they are EU or non-EU citizens, are not competing for the same properties with the average domestic buyer. And as almost all the foreign buyers at the lower end of the market are resident economic migrants, any legislation banning non-residents from the market wouldn’t apply to them in any case. 

In the nearly two decades the Notaries have been counting nationalities, a lot has changed and this data series gives a useful overview of the overseas sector of the market during the market collapse post-2008, the recovery period, Covid-19 and post-pandemic. What was once a sector dominated by the holiday home owner no longer is; 63% of the 140,000 foreign buyers in Spain in 2025 were buying as residents and I predict that trend will continue. And what was once a British-dominated sector of mainly northern Europeans is now a truly global market, another trend that seems set to continue. And whereas the big issue back in 2007 was over-supply, the most pressing concern in 2026 is scarcity and, ultimately, without sustained increases in housing supply, demand - domestic or foreign - will continue to exert upward pressure on prices.  I covered the lack of supply in the property market in more detail in this blog.

^{©Barbara Wood}

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