MADRID — Wealthy Polish, American and Persian Gulf-based property buyers are pouring into Spain's capital Madrid and Costa del Sol seeking luxury refuge from the wars in Ukraine and the Middle East as well as political turmoil in the United States.
Spain, particularly its Mediterranean coast, was long a magnet for sun-seeking Britons and Germans. In recent years, a broader mix of investors looking to diversify their assets and hedge against instability moved in, a half dozen real estate agents, European housing market analysts and a property lawyer told Reuters.
Official government data confirm the trend.
Tourists enjoy an unseasonably warm spring day April 24, 2024, on a beach in Marbella, Spain.
"Whether it's Ukrainians or Poles settling on the Costa del Sol, or Americans coming to Spain, the common factor is the geopolitical situation," said Rebeca Caballero, head of realtor Gilmar's international department.
People are also reading…
According to last year's property register data, more than 39% of all home sales in major tourist provinces including Malaga on the Costa del Sol, Alicante on the Costa Blanca and the Balearic Islands involved foreign buyers.
That helped send prices surging in a country where housing is a major political issue and the central bank called for coordinated policy efforts to boost housing supply with an estimated shortage of 750,000 homes.
Tourists sunbathe on La Carihuela beach in Torremolinos, near Malaga, southern Spain.
Ukraine war triples Polish property demand
Buyers from Poland, among Europe's fastest-growing economies, invested in Spanish coastal properties since 2020. But their purchases tripled since the COVID-19 pandemic and accounted for 4% of all foreign purchases last year, up from 1.6% in 2019.
"The strongest wave of investment came after the outbreak of the war in Ukraine … with a frenzy of purchases made over the phone," said Agnieszka Marciniak-Kostrzewa, founder of a Marbella-based real estate agency.
Marlena Bartkowiak is part of that surge. The 46-year-old, who owns a transport company in Poland, purchased an apartment in Benalmadena on Andalusia's Costa del Sol as a backup plan when the war broke out.
"Spain came to mind as it was somehow the least involved in all sorts of political maneuvering on the European stage," said Bartkowiak, who still primarily lives in Poland.
Neinor Homes, one of Spain's largest property developers, sold 70% of its premium 102-home Santa Clara complex completed in Marbella last year to Polish clients. Polish buyers dominate a 64-floor skyscraper under construction in Benidorm, another coastal hot spot.
A couple cools off at the Mediterranean Sea on a hot spring day on Nueva Andalucia beach in Marbella, southern Spain.
Alternative to Dubai
"Spain right now is a diversification play on security grounds," said Paloma Perez Bravo, CEO of real estate firm Dils-Lucas Fox.
In the same way that conflict on Poland's eastern border drove Polish purchases, real estate agents saw an influx of demand from investors based in the Persian Gulf after the outbreak of the Iran war.
Three real estate firms told Reuters they are negotiating luxury property deals on the Costa del Sol with buyers from Dubai as the conflict deals a blow to the emirate's image as a peaceful haven for the rich. At least two deals already were completed.
Marciniak-Kostrzewa recently sold a property to a Polish client living in Dubai, who sought a safer alternative base for their family.
While Dubai wooed foreigners with zero property tax, realty lawyer Maria Ruiz Lopez said regional wealth tax exemptions or allowances are a draw for Madrid and the Costa del Sol, making them more attractive to rich buyers than other parts of Spain.
"We believe there will be an opportunity to attract those seeking an alternative to Dubai … partly because conflicts make Spain appear as a calmer option," said Mario Lapiedra Vivanco, deputy CEO at Neinor, which already closed a deal with a buyer from Dubai.
Cranes are seen Nov. 6, 2024, over houses under construction at La Finca de Jasmine, a residential project of luxury villas with a clubhouse and spa, in Benahavis, Spain.
Higher prices feed the investment trend
"It's not just violent conflict, but also the political and social pressure," said Gilmar's Caballero, pointing to the surge in Americans — many of them Hispanic — who invested in Spain since President Donald Trump's return to office last year.
"Many do it as an investment. And others see it as a Plan B, because they don't know what's going to happen in the United States," she said.
From 2024 to 2025, Gilmar saw U.S. investments surge from 0.5% to 6.2% of its property transactions and Americans overtake Britons as the leading foreign buyers on the Costa del Sol.
Across Spain, Americans accounted for 2% of property purchases by foreigners and paid the third-highest average price after Swedes and Germans, according to data from the General Council of Notaries.
The broadening pool of foreign buyers pushed up home values.
Real estate agents dealing in properties priced between $1.13 million and $22.68 million say the rising values make buying in Spain an attractive investment, reinforcing the trend and setting the market apart.
The warm climate and stable economy also attract buyers.
Jack Harris, a London-based partner in Knight Frank's international residential team, said luxury home prices in Spain rose by as much as 9.5% year-on-year, faster than in other European markets like France and Italy.
"Spain has been something of an outlier in terms of performance across Europe over the last 12 months," he said.
