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In a recent report prepared by CBRE, Spain stands out on the European stage as one of the most attractive destinations for real estate investment in 2024, occupying an enviable fourth position on the continent. Madrid and Barcelona, two of its most emblematic cities, are not only part of the top 10 cities preferred by investors but also occupy privileged places within this select group, with Madrid in third position and Barcelona in seventh. This interest reflects renewed confidence in the Spanish market, anticipating a recovery in the sector for the second half of the year, with investors focusing on value-added strategies and opportunities to maximize returns.

The rise of sustainability and digitalization

Sustainability and digitalization emerge as key factors in real estate investment decisions, particularly in southern Europe. Spain, along with Italy, is positioned at the forefront of this trend, with an impressive 80% of investors planning to integrate sustainability strategies into their investments.

This approach not only seeks to meet environmental, social and governance criteria, but also aims to increase the profitability of assets through building rehabilitation. In addition, the willingness of investors to pay a premium for properties that meet these sustainable standards is highlighted, marking a significant change in the sector's priorities.

Sector preferences and investment prospects

The study reveals a change in the sectoral preferences of investors, with the logistics and residential segments surpassing the office segment as the most attractive for investment. This trend underlines the interest in modern assets in the logistics and industrial sphere, as well as growing optimism for the residential sector.

At the same time, there is solidity in the market for luxury hotel assets and recovery in the retail sector. The research anticipates a reactivation of real estate investment activity in Europe to the level prior to the rise in global interest rates, predicting a promising horizon for the first half of 2025, despite the current market challenges.

Expert opinion

Jorge Forteza, Chief Executive Officer of BHHS Mallorca believes that: “the luxury real estate market in Spain, with Mallorca as one of its main destinations, continues to be an important reference for international investors, especially for American buyers, in the year 2024. The Balearic island offers an idyllic setting with its combination of natural beauty, warm climate and sophisticated lifestyle, making it a magnet for those seeking exclusive properties abroad. With its crystal-clear beaches, towering mountains and charming Mediterranean towns, Mallorca has earned its reputation as one of the world's most desirable destinations for luxury properties. From villas with sea views to elegant apartments in the heart of the city, the island offers a wide range of options for discerning buyers. In recent years, there has been a notable increase in interest from American buyers in the luxury real estate market in Mallorca. Motivated by the search for second homes, investment opportunities and a Mediterranean lifestyle, these investors are discovering the numerous advantages that the island offers, from its temperate climate to its excellent quality of life and its rich and varied offer. Several factors contribute to Mallorca's attractiveness to US buyers in 2024. Spain's political and economic stability, along with ease of access through direct air connections and infrastructure improvements, make the island even more attractive. for international investors. With the continued interest of American buyers and the enduring appeal of Mallorca as a luxury destination, the island's real estate market is expected to remain robust and dynamic in 2024. Investors have the opportunity to purchase exclusive properties in an environment incomparable, while Mallorca continues to consolidate its position as one of the most sought-after luxury destinations in the world.”

Jonas Krumnikl, Co-Founder & Managing Director of BHHS Marbella states that: “in the ever-changing real estate landscape, Marbella and the Costa del Sol emerge as undisputed leaders, offering a range of opportunities and consolidating themselves as privileged destinations for real estate investment. They attract a global community and millions of annual visitors, supported by a number of factors that continue to drive interest in the region. The luxury real estate market in Spain has experienced significant growth, with Malaga at the forefront of this boom. This province leads the market with 2,500 homes for sale above 3 million euros, representing 34% of the total sales of luxury properties in the country. The majority of these exclusive properties are concentrated in the so-called “Golden Triangle", made up of Benahavís, Estepona and Marbella. This growth has had a notable impact on Marbella real estate prices, which have experienced an average increase of 15% between June 2022 and June 2023, outpacing inflation and national house price increases. However, this growth is not without challenges, as price increases make it difficult for those without high purchasing power to access housing. , especially in the long-term rental market. Despite these challenges, demand for properties in and around Marbella remains strong, driven by political stability, infrastructure investments and reputation as a premier tourist and residential destination. level. The real estate market in Marbella and the Costa del Sol continues to evolve, adapting to global trends and buyer preferences. “With a combination of luxury, technology and sustainability, the region offers a tapestry of opportunities for investors and buyers alike, positioning itself as an attractive and constantly growing destination on the international real estate landscape.

Published: 25 Apr 2024
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