Building Wealth In Spain: Where And Why Foreign Investors Are Buying Luxury Properties

turquoise ocean cove in ibiza, spain with boats and an island in the background
When it comes to luxury property in Spain, there are lots of options for luxury homebuyers.

Most foreign investors are attracted to luxury property in Spain for the pleasant climate and high quality of life.

CaixaBank Research noted that foreign homeownership increased steadily even during the Spanish Financial Crisis. So, how much should your net worth be to join the demographic investing in Spain?

The common definition of a high-net-worth individual (HNWI) is someone with a net worth over US $1 million without counting their primary residence. The same principle applies to ultra-high-net-worth individuals (UHNWIs), whose net worth is considered to be US $30 million or more.

For those looking to expand their portfolios through international real estate, here are several places to build wealth in Spain through luxury properties.

New luxury home project for sale in Benissa, Alicante, Spain

New developments in the Alicante area of Spain include this cutting-edge villa priced at EUR 2.95 million. (Inmobiliaria Rimontgo)


In 2018, foreigners owned 65,300 homes in Spain from just 17,940 houses in 2009, according to CaixaBank Research.

The residential property market in Alicante attracted foreigners, particularly the British, mainly because of favorable weather. It only rains for an average of 37 days per year in the city.

The low annual precipitation level seems to be a deciding factor for foreigners to acquire luxury properties in the city.

CaixaBank Research noted that British HNWIs and UHNWIs also prefer to buy prime real estate along the Andalusian coastline.

Modernist house located on the Tibidabo mountain in Barcelona

The Villa Paula, designed and built by architect Jerome Granell Manresa in 1912, sits on one of the largest private plots in Barcelona. (Inmobiliaria Rimontgo)


Residential properties such as the Francesc Macià 10 lure HNWIs and UHNWIs to invest in Barcelona for two reasons:

  • The city has an emerging creative business environment.
  • The city is known worldwide for fine dining and gastronomy.

These factors somehow affect prime property prices. For example, Francesc Macià 10 ranks among residential developments with the highest per-square-meter price in Spain.

The building also belongs to a certain class of luxury properties in Barcelona: an alternative asset type for those with a limited risk appetite.

Many HNWIs and UHNWIs acquire properties based on an attractive rental yield, given that demand for such properties in the city is on the rise.

outdoor pool area at a miami-style villa in costa del sol area of spain

This impressive architectural design in Costa del Sol is influenced by the architectural styles of Miami, Florida. (Inmobiliaria Rimontgo)

Costa del Sol

Luxury homebuyers hunt for vacation homes in Costa del Sol to live near scenic beaches. The U.K.’s Meteorological (Met) Office describes the municipality as having “the most reliable weather in mainland Spain.”

Indeed, residents in the California of Spain enjoy 325 sunny days every year, according to the Met Office.

HNWIs and UHNWIs, though, consider more than year-round sunshine when they invest in Costa del Sol. Some areas such as Benahavis command the most expensive rental prices in Spain.

Many seasoned investors also switched to long-term rentals as a coping strategy amid the coronavirus pandemic. Vacation rentals used to dominate the leasing activity for luxury properties in Costa del Sol.

Like other parts of Spain, Madrid featues a range of properties including vineyard estates of various sizes. (Inmobiliaria Rimontgo)


HNWIs and UHNWIs invest in Madrid’s property market because of rising prices, even during a pandemic.

The forecast growth rate for prime residential prices in the capital reached 3% in 2021, according to reports. The real estate consultancy also listed Madrid among the world’s top 10 cities for well-being in 2021.

A lower cost of living than other cities such as New York City further influences many rich individuals’ relocation plans.

In addition, Madrid ranked among the top cities with the highest cross-border capital investment in real estate. It correlated with investors’ appetite for potential investments in development land (e.g. green buildings).

decking looking at the water and islands at a modern oasis on the island of ibiza

The Balearic Islands, where Ibiza and Mallorca are located, is favored among affluent foreigners seeking vacation homes. This newly built modern oasis on Ibiza is listed for EUR 3.45 million. (Inmobiliaria Rimontgo)

The Balearic Islands

Foreigners, particularly Germans, favor Ibiza and Mallorca in the Balearic Islands for luxury homes because of cheaper prices.

For instance, you could buy a brand new apartment for EUR 1.9 million (US $2.2 million). The amount greatly contrasts with average prices in other municipalities such as Costa del Sol.

There’s even a villa in Benahavis listed for EUR 23 million (US $26.7 million), making it one of the costliest properties in Spain.

HNWIs and UHNWIs also invest in luxury properties in the Balearic Islands because of significant price growth in the past decade.

As of the first quarter of 2020, average property prices in Ibiza cost almost EUR 3,940 per square meter. Average prices in Mallorca reached EUR 2,135 per square meter.

By 2025, there would be almost 1.4 million people in Spain with a net worth above US $1 million, according to reports. More than 8,200 individuals would have a net worth of more than US $30 million by the same year.

Whether or not you’re already among HNWIs or UHNWIs, a real estate brokerage remains important for prime property purchases.

Click here to find out more about Inmobiliaria Rimontgó, a decades-old broker of the first-ever Golden Visa holder in Spain.


Randolf Santos has covered different segments of the real estate industry since 2014. He worked at S&P Global Market Intelligence before joining Forbes Global Properties as a contributor.