Why are Costa del Sol Properties in such high demand?

Properties on the Costa del Sol have been in high demand for quite some time, which is why working with experienced solicitors in Malaga Spain can be essential for international buyers. Since the 1950s, when tourism took off, Spain, particularly areas like the Costa del Sol and Costa Blanca, has undergone significant transformation

This includes improvements in infrastructure and services as well as cultural advancements in gastronomy with international influences and multicultural diversity. Economically, Spain has developed more slowly than other European countries, with higher unemployment, less competition and lower income per capita. As a result, the consumer price index is lower, making property prices more favourable.

More than 90 years later, Costa del Sol boasts advanced connectivity to international airports and more than half a million beds to accommodate tourists—a number that has tripled since 2016, according to El Sur. Coupled with comparatively low property prices, this generates a persistent cycle of high demand and low supply

Brief overview of Costa del Sol’s appeal.

Spain boasts natural attractions that are hard to match, thanks to its diverse landscape. Rocky mountains meet the sea at white sand beaches, complemented by year-round sunny weather, making it ideal for a wide range of outdoor activities. The Costa del Sol is renowned for its gastronomy, featuring numerous Michelin-starred restaurants and a rich cultural heritage of dining out. The slower pace of life, high-quality healthcare and low cost of living make the Costa del Sol’s appeal easy to understand for both tourists and international buyers.

Attractive climate

Beyond the benefits of vitamin D and studies linking warm weather to improved heart and lung function, the Costa del Sol climate encourages a more active lifestyle, significantly enhancing overall health. The summer months can be hot, but low humidity reduces discomfort. In the winter, cold periods and rainy days occur intermittently.

Interesting read How to buy property in Spain

Year-round Sunshine

The Costa del Sol stretches 160 kilometres between mountain ranges and the sea, from La Línea de la Concepción to Nerja. It features 124 beaches and more than 300 days of sunshine annually, averaging 23 degrees Celsius during the day and 13 degrees at night. Temperatures rarely drop below 5 or rise above 38 degrees, making for an attractive climate.

Outdoor lifestyle

In Costa del Sol, there’s a plethora of activities and excursions to enjoy in the outdoors. Golfing is on the top of the list with over 70 courses spread over the Coast.
From guided tours, boat rides, horse riding, quad safaris or kayaking to renting bikes or enjoy local cuisine in long miles of terrace space.

Hiking is another popular activity. The Coastal Path is a 113-kilometre route along the Costa del Sol, passing through 14 municipalities, including tourist hotspots like Marbella and Nerja. It provides access to a variety of beaches and historical sites dating back almost 2,000 years and 42 watchtowers. It also offers access to 11 marinas, from Puerto Banús to Muelle Uno near the Gibralfaro Castle in Málaga. For those that prefer hiking in the mountains, Costa del Sol offers dozens of trekking routes in hundreds of kilometres.

Idealista ranks the best beaches on the Costa del Sol as follows: Marbella is number one, known for its fancy beach clubs and lively atmosphere. Benalmádena is next, famous for its beautiful beaches and busy promenade. Estepona is known for its clean sand and active community. Manilva is quieter, with beautiful scenery. Fuengirola is great for families, with its friendly beaches and lively town. On the 6th position is Nerja, popular for its lovely coves, clear water and stunning views, making it a favourite for a peaceful beach day. The town’s population has also seen an upward trend, fueled by tourism and foreign investment. Discover the reasons to buy property in Nerja, a town with growing appeal and promising real estate opportunities.

Booming tourism

In 2023, Málaga welcomed 14 million visitors, marking a 9.4% increase from the previous year and exceeding pre-Covid levels by a million, according to the City Council. This growth positions Costa del Sol as an attractive investment destination with a thriving real estate market. Forecasts indicate a 30% increase in tourist numbers in 2024.

According to the newspaper El Español and the National Institute of Statistics, Málaga airport saw 11 million passengers, a 21% increase from 2022 and cruise passengers rose by 52%. Hotels and other regulated accommodations hosted 7.8 million tourists, leading to 29 million overnight stays. In the first quarter of 2024 alone, Málaga welcomed 1.16 million tourists, resulting in 3,740,801 overnight stays. Of these, 1.2 million stayed by foreigners and 492,000 by Spaniards. The average stay was 2.13 days, with an occupancy rate of 81.83%.

Looking ahead to 2024, 3.7 million airline seats to Málaga have been made available, reflecting a 17.1% increase. Málaga continues to be the most visited province in Andalucía by both national and international passengers. Its appeal extends beyond tourism, as an increasing number of people are choosing to move to Málaga, drawn by its culture, excellent quality of life and the climate. Read on “How to move to Málaga” and “Pros and Cost to living in Malaga” for further information.

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Tourist attractions

Setting aside that each town within the Costa del Sol route is worth visiting as a tourist attraction, each one is unique with its own beach and attractions. From shopping in Malaga, trekking in Sierra Tejada, exploring the natural coves of Nerja, enjoying the nightlife in Torremolinos, experiencing the luxury of Marbella, or visiting the whitewashed villages of Frigiliana and Ronda, there is much to see and do.

There are 21 castles, 8 marinas, 5 aqueducts, and many examples of Roman architecture to visit. The region also boasts more than 50 parks and over 100 kilometres of promenade. You can practise all watersports, from kayaking to snorkelling, rent boats and jet skis, or go skydiving or paragliding.

For food enthusiasts, there are countless terraces to enjoy Michelin-star restaurants, tapas, and wine tastings.

Impact on property market

Tourism has a significant impact on the real estate market in Costa del Sol. When tourists visit, they increase the demand for places to stay like hotels and vacation rentals. This surge in demand often leads to higher occupancy rates and rental income, which makes properties in popular tourist destinations more valuable to investors. Additionally, tourism boosts the local economy by creating jobs and encouraging spending, which in turn drives up the demand for homes and commercial spaces. However, rapid tourism growth can strain local resources and infrastructure, causing issues such as overcrowding and higher living costs.

Authora: Rosana Tejada

Tax Advisor – English Speaking

Strong foreign demand

Savills has actually ranked Malaga number one for the preferred destination for remote workers, surpassing Dubai on cost of living and climate. Setting aside the appeal for the Mediterranean lifestyle, Spanish legislation and taxation favours foreign investments and with Costa del sol being a top tourist destination, the demand for properties to buy and rent is very high.
This influx of foreign interest not only supports the local economy through spending on accommodations, dining and activities but also enhances the region’s cultural diversity and economy.

Popular among international buyers

Málaga ranks 22nd in the Global Residential Cities Index, drawing attention from foreign investors. The British market leads the rankings, followed by the German market with the U.S. market ranking third. Costa del Sol is the top destination for retirees, foreign buyers with higher rent per capita than Spain, investors and now remote workers.

Favorable investment climate

The plethora of natural attractions to visit and enjoy, combined with year-round sunshine, the strong demand/short supply cycle, positive economic growth in the region, favourable government laws and legislation, and a stable political environment, along with property prices lower than European counterparts, creates an ideal investment climate that has persisted for some time now with no indications of receding.

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Economic growth

Apart from tourism, flourishing sectors like agriculture, fishing, manufacturing and retail contribute significantly to its economic strength. Proactive governance and community efforts further enhance Costa del Sol appeal, making it an enticing prospect for investors across various industries. With ongoing growth opportunities, the Costa del Sol presents ample potential for tourism, residency, real estate investment, including buy to let in Spain and other ventures

Development projects

In 2023, the Costa del Sol set new tourism records, drawing 14 million visitors and generating over 19 billion euros in revenue. Tourist numbers increased by 9.4% from 2022, and revenue grew by 12%. Additionally, the region saw a 14.7% rise in available tourist accommodations.

According to the newspaper La opinión de Málaga, the hotel construction industry in the Costa del Sol anticipates a record year, with a striking 64.8% growth in projects recorded from January to March. This surge amounts to 412 developments valued at 1.958 billion euros.

Marbella leads hotel investments in Spain, highlighted by the 650 million euro Villa Padierna Beach Resort and the Four Seasons complex, making it one of the worthy reasons to buy property in Marbella at the moment. This growth trajectory follows a robust 11.9% expansion in 2023, underscoring a positive outlook for the Costa del Sol.

The ongoing expansion of Malaga Tech Park, hosting 650 companies and nearly 25,000 employees, the completion of the Auditorio de la Música and La Térmica’s transformation, along with Plaza Mayor’s expansion and Rafael Nadal’s new tennis academy, define Málaga’s development trajectory for the year ahead.

Increased property values

The real estate market in the Costa del Sol is thriving, exceeding optimistic forecasts in the first five months of the year, with expectations of continued growth in the second half of 2024. The province of Málaga now competes not only in price but also in exclusivity with major European capitals like Madrid and Barcelona.

Estepona remains one of the most active municipalities on the Costa del Sol, particularly in the “golden triangle” alongside Marbella and Benahavís. Estepona Este, notably Atalaya – El Campanario, has seen prices exceed 4,200 euros per square metre, with Engel & Völkers forecasting a price increase of 7-10% in 2024.

The exceptionally high demand, coupled with a short supply of properties in these tourist hotspots, is driving up property prices in an upward trend.

Quality of life

According to the Better Life Index, Spain excels in work-life balance, health, social connections, and safety compared to other OECD countries. In the Expat Insider 2022 survey, Spain stands out by ranking 5th among 52 destinations globally for quality of life. The country is particularly noted for its top-ranking performance in the Leisure Options Subcategory. The Spanish healthcare system receives high praise from international reports and studies, consistently ranking among the top performers globally. According to the OECD, Spain boasts one of the highest life expectancies worldwide, most efficient healthcare system in Europe and a robust preparedness for global health threats. All these contribute to Spain being recognized as the world’s healthiest country attributing its success to quality primary healthcare and the benefits of the Mediterranean diet in promoting overall health.

Excellent amenities

The Costa del Sol offers a wide range of amenities to suit different interests and lifestyles. It features prestigious international schools that create a diverse learning environment. Malaga stands out for its cultural offerings, including over 35 museums, a Philharmonic Orchestra, theatres and concert halls.

Marbella hosts prestigious events like an annual art show and the Starlite Festival, while Jazz festivals in Mijas and Alhaurin de la Torre, along with the Nerja Festival in its famous caves, showcase top-notch concerts and ballets. Traditional Spanish festivals are also a highlight, with Holy Week processions in Malaga, Marbella, and Velez-Malaga, as well as celebrations for Virgen del Carmen.

Food lovers will enjoy the Costa del Sol’s diverse culinary scene, offering everything from traditional tapas to gourmet dining experiences. Reflecting its international community, restaurants serve global cuisines alongside Spanish classics.

For shopping enthusiasts, the Costa del Sol has plenty to offer, from large shopping centres like La Cañada in Marbella to luxury boutiques in Puerto Banus. Whether you’re looking for popular fashion brands or upscale labels, Marbella and Malaga provide ample opportunities for shopping.

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Safe and welcoming environment

According to the Global Peace Index 2023, Spain ranks 32nd in the world. In 2022, the crime rate in Spain, measured as the number of criminal offenses per 1,000 inhabitants, stood at 48.6, as reported by the National Statistics Institute (INE). The Ministry of the Interior highlights that cybercrime constituted 16.1% of all criminal offenses, marking a significant 72% increase since 2019. Despite these challenges, Spain maintains a lower crime rate compared to its European counterparts like the UK, Germany, Denmark and Belgium. This achievement is supported by enhanced law enforcement resources and strategic initiatives aimed at addressing both traditional and cyber-related criminal activities.

Spanish people are known for their welcoming nature. With a laid-back and relaxed culture, Spaniards tend to be friendly and easy-going. Embracing their culture often leads to a warm reception from locals, who are generally open and accepting.

Conclusion: Costa del Sol remains a top choice for property buyers

Today, the Costa del Sol remains a vibrant destination, boasting excellent connectivity, over half a million beds for tourists and a climate with more than 300 days of sunshine annually. Its diverse outdoor activities, dynamic cultural scene and culinary offerings attract both tourists and international property buyers alike. Since the 1950s, fueled by tourism growth, the Costa del Sol has seen significant development, including infrastructure improvements, culinary advancements and a rich multicultural blend. Despite economic challenges, Spain’s lower consumer price index and affordable property prices continue to drive demand for real estate in the region. The cost of buying a property in Spain remains comparatively favourable, contributing to its appeal as a desirable investment destination. Property conveyancing services in Spain are efficient and well-regulated, further facilitating the purchase process for international buyers.

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FAQ’s

Properties on the Costa del Sol have been highly sought after for decades. With over half a million tourist beds and abundant sunshine year-round, coupled with diverse outdoor activities and rich cultural offerings, the region remains appealing to both tourists and property investors. Booming tourism, stable economic growth and a welcoming atmosphere further enhance its status as a prime real estate destination.

The Costa del Sol in Spain attracts a diverse array of property investors from around the world. Among the main nationalities investing are British, Scandinavian, Germans, Belgians and French buyers.

Tourism exerts a profound influence on the property market in Costa del Sol, driving both demand and investment trends. The region’s popularity among tourists fuels a steady demand for rental properties, particularly during peak seasons. This demand often translates into higher property prices.

Yes, property prices in Costa del Sol have been rising, driven by strong demand from both local buyers and international investors. This trend reflects a growing interest in real estate investment opportunities in key areas along the Costa del Sol.

Costa del Sol boasts a rich array of amenities and services that cater to the diverse needs of its residents and visitors. From prestigious international schools and cultural attractions like museums and theaters to extensive outdoor activities such as golfing and hiking, the region offers something for everyone. Gastronomically, it excels with Michelin-starred dining options Shopping enthusiasts can indulge in everything from large shopping centres with high-street brands to luxury boutiques combined with excellent healthcare facilities, transportation networks and abundant leisure options, Costa del Sol ensures a high quality of life and enjoyable experiences for all who reside or visit here.