Rents in Spain will increase by 11.5% in 2024, which is the highest annual increase ever, according to a study. report from Idealistaone of Spain’s leading real estate platforms. The sharp increase reflects mounting problems in the country’s housing market, where demand continues to outstrip supply.
New record average: €12.2 per square meter
The national average monthly rent is now €12.2 per square meter, the highest figure ever recorded by Idealista. The upward trend was observed in almost all regions, underscoring widespread renter affordability concerns.
31 Spanish capitals will reach record rents by 2024
A total of 31 Spanish provincial capitals recorded their highest ever rents in the last quarter of 2024. All capitals saw higher rental costs compared to December 2023, with the sole exception of Lleida, where prices fell by 2.2%. Ávila led annual rental growth, with an increase of 18.6%, followed by Madrid (+15.3%), Guadalajara (+14.4%), Oviedo (+14.4%) and Barcelona (+13.9 %).
Among other key markets, notable annual increases were observed in Valencia (+12.2%), Palma (+11.9%), Málaga (+11.4%) and Alicante (+10.2%). More moderate increases occurred in Seville (+9.5%), Bilbao (+9.2%) and San Sebastián (+7.2%).
Barcelona remains the most expensive city in Spain for rental, with an average price of €23.4 per square meter, followed by Madrid (€20.7/m²) and San Sebastián (€18/m²).
Palma is in fourth place (€17.2/m²), while Málaga secures fifth place (€15.1/m²). At the other end of the spectrum, Zamora has the lowest rental prices (€6.7/m²), followed by Ciudad Real (€6.8/m²) and Lugo (€7.3/m²). Other affordable markets include Cáceres, Ourense, Badajoz, Teruel and Jaén, all averaging €7.5 per square meter.
Drivers of rising prices
The Idealista report highlights several factors contributing to the increase in rental prices:
- High demand: Urban centers and tourist-heavy areas continue to attract both domestic and international tenants.
- Limited offer: A shortage of available rental properties has intensified competition, driving up prices.
- Economic pressure: Rising interest rates and inflation have made home ownership less accessible, causing more people to look for rental options.
- Short-term rental: The prevalence of short-term rental platforms has further reduced the availability of long-term rentals, especially in major cities and holiday hotspots.
Policy interventions show mixed results
Despite government efforts to regulate rental markets, such as rent caps in designated high-demand areas, the measures have had limited impact on curbing price increases. Critics argue that these regulations discourage property owners from entering the long-term rental market, exacerbating the supply shortage.
In cities like Barcelona, where rent control policies have been introduced, landlords have increasingly shifted properties to short-term rentals or taken them off the market entirely, further tightening the market.
Outlook for 2025
As Spain moves into 2025, the housing market remains a key concern for policymakers, renters and property owners. Analysts predict continued price pressure, especially in regions of high demand, unless substantial measures are taken to address structural issues in the market.
The Idealista report underlines the need for balanced solutions that ensure housing accessibility while maintaining incentives for property owners. For now, tenants in Spain are faced with the dual challenge of navigating a competitive market and controlling rising costs.
