Spain's Economic Growth and Real Estate Investment Set to Expand in 2026
Spain's 2026 economic growth is fueled by domestic demand, with real estate investment set to grow up to 10%, led by affordable housing and strong office demand in major cities.
- • Real estate investment in Spain is projected to grow 5-10% in 2026, reaching up to 21 billion euros.
- • Stable interest rates and better financing conditions are key factors supporting investment growth.
- • Domestic consumption and housing investment will be the main regional economic growth drivers in 2026.
- • Madrid and Mediterranean regions are expected to grow above average, while tourism-dependent areas face moderate growth.
Key details
Spain is poised for economic growth in 2026, underpinned by strong domestic demand and robust real estate investment. According to a recent report, Spain's real estate investment is forecasted to grow between 5% and 10%, reaching a total investment volume of 19 to 21 billion euros in 2026. This follows a significant 31% increase in 2025, closing at over 18.4 billion euros, the highest since 2018. This surge is driven by stable interest rates near 2% and improved financing conditions, revitalizing both traditional banks and alternative lenders.
The real estate sector's 'Living' segment remains the primary focus of capital, particularly affordable housing projects, while office space leasing in Madrid and Barcelona exceeded 810,000 square meters in 2025, with positive expectations for 2026. Other segments, such as hotels, logistics, data centers, and healthcare-related properties, are gaining momentum, supported by steady tourism arrivals and increasing demand.
Parallel to real estate trends, regional economic growth in Spain is increasingly dependent on internal consumption and housing investment. Service-heavy regions including Madrid and parts of the Mediterranean are expected to experience growth above the national average in 2026. However, areas relying heavily on tourism and automotive manufacturing face moderate growth due to weak exports and cyclical normalization.
Persistent structural challenges like housing shortages and labor market pressures may impact growth disparities across Spain's autonomous communities. Still, the overall scenario suggests a stabilization of prime real estate yields and a continued appetite for quality assets aligning with ESG criteria.
Paloma Relinque from CBRE highlights how Spanish real estate is beating expectations amid global macro trends and structural imbalances, emphasizing ESG and product quality as key to attracting investment. Meanwhile, BBVA's regional observatory stresses the shift in growth reliance toward domestic drivers between 2025 and 2027, projecting a favorable outlook especially for internal consumption and investment in housing sectors.
Looking ahead, Spain's economic and real estate sectors appear well-positioned to sustain momentum through 2026, supported by sound financial conditions, rising domestic demand, and diversified investment interests across property segments.
This article was translated and synthesized from Spanish sources, providing English-speaking readers with local perspectives.
