Whether you’re thinking about buying or selling a home in Marbella or elsewhere on the Costa del Sol, late 2025 has been a busy time for the market. Prices are at record highs and international interest is very strong. The region remains popular for its beaches and lifestyle, and that shows in the numbers. Here’s a friendly breakdown of what’s happening and what it might mean for you.
Prices Are Rising Fast
House prices on the Costa del Sol hit all-time highs in 2025. For example, by August 2025 the average asking price for a resale home in Málaga province was €3,842 per square meter, up 13.8% from a year earlier. Marbella leads the pack: prices there reached about €5,258/m². Nearby luxury towns like Benahavís also saw prices above €5,000/m². Even smaller towns along the coast saw big jumps – Ojén and Algarrobo-Costa rose over 25%, and Fuengirola’s average passed €4,300/m² after an 18.8% rise.
Figure: Malaga city and port. Malaga’s average home price is a bit lower than Marbella’s, but it’s rising quickly too (up ~15.6% to €3,549/m²) as the city grows.
In short, prices keep climbing across most of the coast – luxury “Golden Mile” areas in Marbella are still highest, but many smaller towns are catching up. People should know that this pace of increase might slow down. Analysts expect growth to become more moderate – perhaps around 5–8% per year instead of double-digit gains – as the market adjusts. But for now, sellers in this area can usually get strong prices, and buyers face competition.
Strong Demand, Especially From Abroad
A key reason for the boom is high demand from foreign buyers. Almost four out of every ten home sales on the Costa del Sol are to foreign nationals. In Marbella in particular, recent data show that 63% of buyers were foreigners. Many are second-home or investment buyers who love the sunshine and lifestyle. In fact, between September 2024 and August 2025, Marbella saw 4,322 property sales – and 92% of those were resale apartments, not new buildings. About 13% of Marbella’s buyers were British (roughly 365 people) and the rest came from many other countries.
These international buyers keep the market lively. During the first half of 2025, overall home sales in Málaga province barely dipped (down only 1% vs a year before) and foreign buyers still made up roughly 40% of transactions. People moving here to live permanently have grown slightly, while vacation-home buyers stayed just a bit lower. That mix means demand is strong for both family homes and holiday apartments.
Tight Supply and New Construction
One challenge is limited supply. Coastal towns can’t build unlimited new homes, so choices are tight. Homeowners tend to hold on to well-located houses. Builders are busy, though: sales of new-build homes jumped about 12% in H1 2025, suggesting there’s big hunger for the few new developments available. But new projects often take time to finish, and lots of buyers end up on the resale market.
Because supply is tight and costs to build are high, local authorities say only a small number of towns can actually meet current demand. This shortage of fresh homes is pushing up prices on existing homes everywhere. It also means that in places like Marbella, homes often get multiple offers quickly. Our advice: buyers should be ready to move fast and have financing in place, while sellers should price realistically to find the right buyer.
Mortgages and Financing
Good news for buyers: mortgage rates have eased a bit. Spain’s benchmark mortgage rate (the Euribor) has fallen recently, so banks are lending more. SPI reports that mortgage borrowing on the Costa del Sol was rebounding in late 2025 as rates dropped. Lower loan costs could bring a few more buyers into the market, or help current owners refinance.
Still, loans are not super-cheap – buyers need a solid deposit and income. But the slightly better rates mean interest is not as huge a hurdle as last year. Many experts expect that as financing costs stabilize, the housing market might see a bit more activity, even as prices rise at a gentler pace.
Looking Ahead
So what does this mean if you’re planning ahead? Overall, the Costa del Sol remains a sellers’ market, especially in prime areas like Marbella. Sellers can often get strong offers, but the keenest buyers won’t buy at any price. Stiff competition means a home priced too high may linger, as even in this boom buyers are cautious.
Here are some key takeaways:
- Prices are high. Homes on the coast are in demand, so expect a seller’s market in many areas. Buyers should focus on properties that are fairly priced and move quickly.
- Foreign demand stays strong. With roughly 40% of sales to foreigners, the Costa del Sol is an international market. Non-resident buyers often pay cash or larger down payments, keeping momentum up.
- Limited supply. New homes are scarce. If you find a home you like, delays or hesitation could mean missing out – and that drives up sale prices.
- Mortgage costs easing. Interest rates have dipped a bit, so financing is slightly more affordable. Buyers should shop around, and owners could check refinancing to lower payments.
- Future growth may slow. After years of big jumps, many experts think price rises will ease a bit. The market is shifting from very fast growth to steady growth, maybe around 5–8% a year.
The bottom line: The Costa del Sol market in late 2025 is strong and stable, not collapsing or “bursting.” Experts like Ricardo Pumar of Grupo Insur say there’s no sign of a bubble – in real terms prices are still below the last boom. But this means buyers should be mindful of value and long-term plans, while sellers can feel confident to list now. Smart planning – checking legal and financing details, and understanding local rules – will help anyone in this market.
Of course, conditions can change. Keep an eye on factors like new housing rules (for example, any limits on holiday rentals), and on transport and infrastructure. (Some analysts argue that better transit links could make inland or western towns easier to reach, which might eventually spread demand.) For now, though, Marbella and its neighbors look set to stay popular and pricey for the foreseeable future. We hope this report helps you feel more informed and prepared whether you’re buying, selling, or just watching the market.
Sources: Recent reports and data from Spanish Property Insight and Idealista, including SPI’s West Costa del Sol market analysis
