Costa Dorada housing market report – H1 2025

This report provides a data-driven overview of the housing market in Tarragona province, with a particular focus on the Costa Dorada. It covers sales activity, prices, mortgage lending, and construction during the first half of 2025, helping buyers, sellers, and property professionals understand recent performance and longer-term trends.

Sales performance

There were 9,210 home sales in Tarragona province in H1 2025, representing a year-on-year increase of 14% (Fig. 1-1). Compared to the ten-year average, sales were up 44%, and over the last decade transaction volumes have risen by 127%, confirming a structurally larger market than ten years ago.

Foreign buyers accounted for 1,528 purchases in the period, down 2% year-on-year. Despite this short-term decline, foreign demand remains well above historical norms, standing 26% above the ten-year average and 102% higher than a decade ago. By residency status (Fig. 1-2):

  • 1,169 homes were bought by foreigners living in Spain (expats), down 2% year-on-year
  • 359 homes were bought by foreign non-residents (FNR), down 3% year-on-year

Over ten years, expat purchases have increased by 175%, while FNR purchases are up just 8%, highlighting that long-term growth in foreign demand has been driven primarily by residents rather than second-home buyers.

The market share of foreign buyers stood at 17% (Fig. 1-3), down from 20% in the same period last year and below the highs seen earlier in the past decade, pointing to some loss of momentum in international demand.

New-build sales totalled 467 transactions, up 7% year-on-year (Fig. 1-4). Compared to the ten-year average this represents a 21% increase, and over ten years new-build sales are up 38%, indicating moderate but steady growth in this segment.

Focusing specifically on Costa Dorada municipalities, there were 4,438 home sales in the period, a year-on-year increase of 8% (Fig. 1-5). Sales were 27% above the ten-year average and 96% higher than ten years ago, underlining the long-term expansion of this coastal sub-market.

Prices

According to the Spanish Housing Ministry, the average price of homes sold in Tarragona province during H1 2025 was €142,982 (Fig. 2-1), up 3% on an annualised basis. The average price of newly built homes was €195,724, down 8% year-on-year.

A ten-year price index shows that overall property prices have risen from 100 to 109, while new-build prices have increased to 146 (Fig. 2-2). This means that, over the decade, new-build prices have grown significantly faster than resale prices. The divergence is likely explained by rising construction costs, more stringent building regulations, and limited availability of new development land, which have pushed up replacement costs for new homes.

Over the last five years, prices for all property types are up 18%, while new-build prices have increased by 15%, suggesting that resale prices have been catching up more recently.

As illustrated in Fig. 2-3, asking prices in key Costa Dorada municipalities continue to trend upwards. In Salou, average asking prices rose from around €2,207 per square metre in 2015 to €4,312 in 2025. This represents a 95% increase over ten years and a 41% rise over the last five years. The latest year-on-year increase was 3%, pointing to continued growth, albeit at a more measured pace than in the immediate post-pandemic period.

Mortgage lending

There were 4,964 new mortgages signed in Tarragona province in H1 2025 (Fig. 3-1), up 26% year-on-year. Lending activity was 50% above the ten-year average and 134% higher than a decade ago, indicating a strong recovery in mortgage-backed demand.

The average Euribor rate during the period was 2.27% (Fig. 3-2), with a year-on-year decline of 38%. This level sits well below the recent peak of 3.69% recorded in 2023 but remains far above the historic low of -0.49% seen in 2021. The current level reflects a shift away from peak monetary tightening, as the ECB has signalled the end of rate rises and markets increasingly expect gradual rate cuts, supporting improved affordability relative to recent years.

Housing starts

There were 972 housing starts in Tarragona province based on planning approvals during H1 2025 (Fig. 4-1), representing a sharp 77% year-on-year increase. Compared to the ten-year average, housing starts were up 116%, and over ten years they have increased by 182%. This surge points to renewed developer confidence, likely encouraged by sustained sales volumes and long-term price growth, particularly in coastal areas such as the Costa Dorada.

Outlook

The Costa Dorada housing market enters the second half of 2025 with solid underlying momentum. Sales volumes remain well above long-term averages, supported by resilient domestic demand and a gradual easing in mortgage conditions as interest rates trend lower. While foreign buyer activity has softened slightly and market share has declined from recent highs, absolute levels of international demand remain historically strong. Continued growth in housing starts points to improving supply, particularly in the new-build segment, which should help moderate price pressures over time. Overall, the outlook is positive, though the balance between recovering supply, foreign demand trends, and the pace of monetary easing will be key factors shaping market performance over the coming quarters.

Previous reports

The Costa Dorada’s property market performance in 2024.

The Costa Dorada housing market in 2024 demonstrated steady performance, supported by consistent sales activity, ongoing interest from both domestic and international buyers, and a resilient resale segment. While the new-build sector experienced a slight slowdown in annual transactions, long-term trends remained positive, with planning approvals pointing to continued development across key municipalities. Average property prices continued to rise, particularly in well-established coastal areas such as Salou, reflecting strong demand and limited inventory. Although higher interest rates impacted mortgage activity, signs of easing monetary policy towards the end of the year provided a more favourable outlook for buyers. This report presents an in-depth analysis of the Costa Dorada property market in 2024, highlighting key trends and data-driven insights across sales, prices, mortgages, and construction activity.

Sales performance

Home sales in Tarragona showed moderate overall growth in 2024. A total of 16,801 homes were sold across the province, an increase of 8% year-on-year (Fig. 1-1). Compared to the ten-year average, transaction volumes rose by 27%, with cumulative growth of 100% over the decade.

Sales involving foreign buyers reached 3,150—an increase of 2% from the previous year. This segment grew by 28% compared to the ten-year average and is up 90% over a ten-year horizon. Of these sales, 2,290 were made by expatriates living in Spain, while 860 involved foreign non-residents (FNR), typically purchasing second homes or investment properties (Fig. 1-2). Purchases by expats increased 2% year-on-year and have grown 150% over the past decade. FNR sales were largely stable, up only 0.5% from the prior year and 16% over ten years.

Despite rising volumes, the foreign market share declined slightly to 19% from 20% the previous year (Fig. 1-3), indicating that local buyers are currently growing at a faster pace.

New build home sales were soft, with 877 units sold during the year, down 3% year-on-year (Fig. 1-4). However, this figure remains 29% above the ten-year average and reflects a modest long-term gain of 9%.

Costa Dorada home sales 

The Costa Dorada municipalities—a magnet for both domestic and international buyers—saw a total of 8,305 home sales, marking a 7% annual increase (Fig. 1-5). Compared to the ten-year average, activity in this subregion rose by 24%, with cumulative growth of 85% over the past ten years.

House price trends

The average home price in Tarragona in 2024 was €138,341 (Fig. 2-1), a year-on-year increase of 5%. By contrast, newly built properties posted an average price of €178,055, reflecting a 17% annual decline. This divergence raises some interesting questions about supply trends or changes in buyer preferences, particularly in new development types or locations.

Over a ten-year period, prices for all property types have risen more than for new builds. The price index for all property rose from 100 to 135.4, while the index for new builds only increased to 130.6 (Fig. 2-2). This suggests that resale properties outperformed new construction by nearly 5% over the decade—a trend possibly driven by limited new supply, higher demand for resale properties in established neighbourhoods, or discounts and incentives in the new-build segment.

On a five-year horizon, average property prices have increased by 35%, while new build prices rose by just 20%, underscoring the relative resilience of the resale market.

Salou case study 

In Salou, one of Tarragona’s key coastal markets, the average asking price per square metre stood at €2,228.5 in 2024—up 9% year-on-year (Fig. 2-3). Over a five-year period, asking prices in Salou rose by 23%. The ten-year asking price index increased from 100 to 131.6, meaning listed prices have appreciated by more than 31% since 2014. This rise signals solid confidence among vendors, particularly in areas with strong tourism appeal.

Mortgage market

There were 7,329 new mortgages signed in Tarragona province in 2024 (Fig. 3-1), representing an 8% year-on-year decline. However, this figure remains 12% above the ten-year average and 68% higher than a decade ago, underlining the long-term recovery of the credit market.

The average Euribor rate during the year stood at 3.27% (Fig. 3-2)—down from 3.86% in 2023. Notably, this remains close to the highest level seen in the last decade, following a low of -0.49% in 2021. The decline signals a potential turning point in the European Central Bank’s (ECB) monetary policy, as inflation pressures begin to stabilise across the Eurozone. Market forecasts suggest a likely easing of rates in the near term, which could improve mortgage conditions and help restore lending activity.

Housing starts

Construction activity weakened in 2024. There were 1,015 housing starts based on planning approvals (Fig. 4-1), down 17% year-on-year. However, this figure remains 13% above the ten-year average and has increased by 88% over the last ten years, indicating a still-healthy long-term trend despite annual volatility.

The decline in 2024 may reflect tighter financing conditions, permitting delays, or developer caution amid shifting demand.

Summary

Key insights from Costa Dorada’s housing market in 2024:

  • Home sales rose 8% year-on-year and are up 100% over the last decade.
  • Foreign buyers accounted for 19% of all transactions but lost some market share.
  • The resale market outperformed new builds both in pricing and sales growth.
  • Asking prices in Salou rose 9%, with long-term appreciation of 31%.
  • New mortgage volumes declined 8% as high Euribor levels impacted affordability.
  • Housing starts fell by 17%, but long-term trends remain positive.

Conclusion

The Costa Dorada housing market in 2024 remained buoyant overall, supported by steady transaction volumes, solid demand from international and domestic buyers, and long-term price appreciation. However, the decline in mortgage activity and new housing starts signals a transitional phase marked by elevated borrowing costs and cautious new development.

Looking ahead, any downward adjustment in interest rates by the ECB would likely reinvigorate both demand and building activity. In the meantime, resale properties located in vibrant coastal areas like Costa Dorada and Salou are expected to remain attractive to both investors and lifestyle buyers.