The Spanish property market continued its robust growth in the third quarter of the year, according to newly released data from Spain’s housing ministry.

Figures show that 165,608 homes were sold in the third quarter (Q3), reflecting a 16% increase year on year and positioning the market just behind the record levels seen in 2022—when sales surged following the pandemic. Overall, these Q3 figures stand 23% above the ten-year average, pointing to the enduring strength of Spain’s property sector (see chart above).

Surge in domestic demand and stable foreign interest

This year has been defined by the strong performance of local buyers. While foreign demand has remained steady, its relative share has declined in the face of even stronger domestic appetite. In the third quarter, 30,408 transactions involved a foreign buyer—up 7% year on year. Of these, 16,916 purchases were made by expatriates (an 8% increase) and 13,492 by foreign non-residents buying second homes (a 6% rise).

Despite this growth, foreign buyers’ market share decreased from 20% to 18% (see figure 3), mainly due to a 19% surge in local transactions, which reached 134,958. Domestic confidence in Spain’s property market has been the key driver behind these shifting dynamics.

Year-to-date trends and foreign market share

Over the first three quarters of this year, total sales have climbed 10% to 515,810 units, driven primarily by an 11% increase in domestic demand and a more modest 3% rise in foreign demand. As a result, the foreign share of the Spanish property market has edged down to 23% from 24% a year ago.

Despite the slight decline in foreign market share, the overall upward trend remains impressive. The outlook suggests that 2024 is poised to be one of the best years on record for Spain’s property market, buoyed by strong local demand. Foreign interest, meanwhile, regained some momentum in the third quarter, although not enough to match the vigour of domestic buyers.

Economic tailwinds and record-breaking momentum

The continued strength of Spain’s property sector is closely linked to the country’s broader economic performance. According to The Economist magazine, Spain is on track to be the best-performing rich-world economy in 2024 by several measures, including GDP growth, inflation, unemployment, fiscal policy and stock market performance. The pace of job creation and economic expansion is notably faster than in the United States, further boosting buyer confidence.

With these figures in mind, it appears that 2024 will be the second-best year on record for the Spanish property market. Supported by a thriving economy and a surge in domestic demand, the Spanish property boom shows no sign of slowing any time soon.