Spain | Real estate sector outlook and profitability. March 2026

Summary

Housing demand will remain solid driven by employment and immigration, while the lack of supply will raise the deficit to 800,000 units in 2027. This will cause strong price increases in a sector burdened by low profitability compared to its European peers.

Key points

• Key points:
• Housing sales will suffer a slight contraction of 1.6% in 2026, but product shortages will push nominal prices up with growth of 10.2% in 2026 and 6.8% in 2027.
• New building visas will grow by 12.5% in the biennium, reaching around 160,000 homes annually, an insufficient volume to cover the estimated household creation.
• The financial profitability (ROE) of construction improved marginally to 4.1% in 2024, standing 12.5 percentage points below the historical average of France and Germany.
• The Spanish sector has a higher share of SMEs than the European average, which negatively affects margins due to low asset turnover and high immobilization of equity.

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