Authored by the expert who managed and guided the team behind the Spain Property Pack
Yes, the analysis of Alicante's property market is included in our pack
What will happen in Alicante’s real estate market? Will prices go up or down? Is Alicante still a hotspot for foreign investors? How is Spain’s government impacting real estate policies and taxes in 2025?
We’re constantly asked these questions because we’re deeply involved in this market. Through our work with notaries, real estate agents, and clients who buy properties in Alicante, we’ve gained firsthand insights.
That’s why we created this article: to provide clear answers, insightful analysis, and a well-rounded perspective on market predictions and forecasts.
Our goal is simple: to ensure you feel informed and confident about the market without needing to look elsewhere. If you think we missed the mark or could do better, we’d love to hear your thoughts. Feel free to message us with your feedback or comments, and we’ll work hard to improve this content for you.
How this content was created 🔎📝
1) Rental yields in Alicante's tourist areas will rise as short-term rentals bounce back
The rental market in Alicante's tourist-heavy areas is poised for a yield increase due to a rebound in short-term rentals. In 2023, Alicante welcomed 9.7 million tourists, marking a significant recovery in tourism post-pandemic. This influx of visitors has naturally led to a surge in demand for short-term rentals, especially in central areas and near beaches.
In 2023, 17% of homes rented on the Costa Blanca were quickly taken within 24 hours of listing, highlighting the high demand for short-term accommodations. This demand is further evidenced by the impressive 75% average occupancy rate for short-term rentals, with properties being booked for 274 nights a year. Such high occupancy rates are a clear indicator of the strong demand, which in turn contributes to higher rental yields.
Moreover, short-term rentals in Alicante generate an average annual revenue of €21,000, which is significantly higher than what long-term rentals typically offer. The median daily rate for these rentals stands at €83, further supporting the potential for higher yields. The growth of platforms like Airbnb, with 3,600 active listings as of September 2024, has also played a crucial role in boosting the rental market, with hosts earning an average of €21,000 annually.
Sources: Tupropertyinspain, Airbtics, The Travel, Euro Weekly News
2) Sustainable housing projects will grow in Alicante due to new environmental regulations
Alicante is making waves in sustainable housing thanks to new environmental regulations.
These regulations are not just talk; they come with real incentives for eco-friendly construction. For example, a public housing project worth EUR 3.4 million was recently approved, featuring an A energy rating and solar panels. This project is a testament to the city's commitment to energy efficiency and sustainability.
In 2024, Alicante saw a remarkable surge in eco-friendly housing developments. In the second quarter alone, 2,689 new builds were started, marking the second-highest number in 15 years. Over the past year, 8,233 homes have been initiated, all with a focus on sustainable practices, showing a clear demand for such housing.
The local government isn't just sitting back; they're actively promoting eco-friendly housing. One bold move was the Alicante City Council's decision to impose a two-year ban on new licenses for short-term holiday rentals. This was done to tackle mass tourism and highlight the importance of sustainable living spaces.
These efforts are part of a broader strategy to create a more sustainable living environment in Alicante. The city is not only focusing on new builds but also on transforming existing spaces to be more eco-friendly. This approach is attracting both residents and investors who are keen on sustainable living.
With these initiatives, Alicante is positioning itself as a leader in sustainable housing, making it an attractive option for those looking to invest in property with a green edge.
Sources: Mayors of Europe, Idealista, Short Term Rentalz
We have made this infographic to give you a quick and clear snapshot of the property market in Spain. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
3) Alicante’s property prices will keep rising due to limited land and high demand
Property prices in Alicante have been on the rise, with a notable increase in recent years.
In October 2024, the average price for residential properties hit €2,316 per square meter, reflecting a 17.44% jump from December 2023. This surge is largely due to the limited availability of new land for development, making existing properties more valuable.
Alicante's charm as a tourist hotspot and a retirement haven has fueled demand for both short-term rentals and permanent homes. The rental market is thriving, with properties booked for an impressive 274 nights a year, underscoring the area's appeal.
Structural challenges, like a shortage of skilled labor and land earmarked for development, have further tightened the housing supply. This scarcity is a key factor driving up property values.
With its sunny climate and vibrant culture, Alicante continues to attract buyers, keeping demand high. The combination of limited land and high demand suggests that property prices will keep climbing.
Sources: Indomio, CaixaBank Research, Airbtics
4) Demand for homes in Alicante's coastal areas will rise as remote work lets more people live by the sea
The coastal neighborhoods of Alicante are seeing a surge in demand as remote work lets more people choose seaside living.
In 2024, property prices in these areas jumped by 7.8% in the first quarter compared to the same time in 2023. This rise shows that more folks are eager to buy homes by the sea. Alicante is not just a pretty face; it's globally recognized as a top spot for foreign residents, making it a magnet for remote workers.
The city's friendly vibe and great living conditions are big draws for those who can work from anywhere. Plus, with the Spanish economy growing in 2023, offering more jobs and better pay, it's easier for remote workers to think about moving to places like Alicante.
Digital nomads are also eyeing Alicante, as seen in the uptick in internet searches and property inquiries. The city boasts excellent infrastructure for remote work, including high-speed internet and plenty of co-working spaces. This makes it a perfect spot for professionals who want to enjoy coastal life while keeping up with work.
Imagine working with a sea view, thanks to Alicante's setup that supports remote work. The city is a dream for those who want to blend work and leisure seamlessly. With more people able to work from anywhere, the demand for homes in Alicante's coastal areas is only going to grow.
Sources: TechMeetups, SpainEasy, CaixaBank Research, TechMeetups, Euro Weekly News
Our team found this video, Living in Costa Blanca: Explore Lifestyle and Investment, which highlights the increasing popularity of Alicante's coastal neighborhoods among remote workers.
5) Rental yields in Alicante's city center will rise as urban living gains appeal after the pandemic
The rental yields in Alicante's city center are poised to increase as urban living becomes more attractive post-pandemic. This trend is largely driven by the significant growth in the tourism industry, which saw over 10 million international visitors between January and October 2024, marking a 16.3% increase compared to the previous year. This influx of visitors contributes to the rising demand for urban living.
Additionally, property prices in Alicante's city center are expected to rise in 2025, with an anticipated increase of 3% to 7% from their 2024 values. This rise in property prices indicates a growing interest in urban properties, further fueled by the shortage of supply and increased demand in the rental market. Some neighborhoods have experienced rental income growth of up to 28% interannually, suggesting higher occupancy rates in city center rentals.
The appeal of urban living is also enhanced by improved urban infrastructure and amenities, such as better transportation links, which are likely to increase property values. Moreover, the Spanish government's incentives for foreign property buyers, like the Golden Visa program, continue to attract international investors to Alicante, promoting city living by offering attractive investment opportunities.
Sources: Euroweekly News, Tu Property in Spain, Travel and Tour World
Get to know the market before you buy a property in Alicante
Better information leads to better decisions. Get all the data you need before investing a large amount of money. Download our guide.
6) Affordable housing prices in Alicante will drop slightly as new developments boost supply
In 2024, Alicante experienced a significant increase in new housing developments. The College of Technical Architecture reported that 2,689 new builds were started in the second quarter alone, marking a 51% increase from the first quarter and a 56% rise compared to the average over the past seven years. This surge in construction activity indicates a growing supply of housing in the area.
Additionally, the province saw a total of 8,233 homes started in the last 12 months, with Alicante leading the way in new housing construction. This increase in supply is expected to impact the housing market by potentially stabilizing or slightly reducing prices, as more options become available to buyers.
CaixaBank Research has noted that the gap between housing demand and supply is narrowing, suggesting that the market is moving towards a more balanced state. As the supply of new housing continues to grow, it is likely that prices will stabilize or experience a slight decline, especially in the affordable housing sector.
Sources: Idealista, CaixaBank Research
7) Luxury property prices in Alicante will rise moderately as international interest increases
In recent years, Alicante has seen a noticeable uptick in international interest, particularly in its luxury real estate market. Back in 2023, the region recorded a significant number of property deals with foreign buyers, marking an 8% increase from the previous year. This trend continued into 2024, with international buyers accounting for a substantial portion of luxury home sales, especially in towns like Altea and Jávea.
The appeal of Alicante's luxury real estate is further bolstered by its competitive pricing compared to other European hotspots. This makes it an attractive option for high-net-worth individuals seeking luxury properties at more affordable prices. Additionally, the ongoing development of infrastructure projects, such as improved transportation links, has enhanced the region's appeal, drawing more international buyers.
Moreover, Alicante's growing reputation as a hub for digital nomads and expatriates has contributed to sustained demand for residential properties. The Spanish government's Golden Visa program also plays a crucial role in attracting foreign investment, offering benefits like residency opportunities to international buyers. These factors combined have set the stage for a moderate price increase in Alicante's luxury real estate segment.
Sources: Idealista, Bravos Estate, Euro Weekly News
8) Rents in Alicante's student areas will rise as the university expands its programs
The rental market in Alicante's student areas is set to rise as the University of Alicante expands its programs.
With the university's recent growth, 99.14% of the 5,937 new entry places were filled for the 2024-25 academic year. This means more students are looking for places to live, and landlords are likely to respond by raising rents. It's a classic case of supply and demand, where more students mean more competition for housing.
In the US, when universities expand, nearby student housing often sees rent hikes. For instance, student housing within a mile of campuses experienced a 7.3% rent growth in March 2024. This trend is likely to mirror in Alicante, where the university's expansion is expected to push rents higher.
Alicante already faces a chronic shortage of quality student accommodation. The current student-to-bed ratio is about 6:1, which is quite high. This shortage is not just a local issue; Spain as a whole struggles with outdated student housing and a lack of over 350,000 beds. As new programs like Physics and Mathematics are introduced, the demand for housing will likely outstrip supply.
With the university's expansion, the housing crunch is expected to worsen. The lack of modern student housing options means that students will have to compete for limited spaces, driving up rents. This is a familiar scenario in many university towns, where the influx of students often leads to a housing squeeze.
Sources: University of Alicante, Amber Student, Amro Partners, CoStar
We made this infographic to show you how property prices in Spain compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It’s an easy way to spot where you might get the best value for your money. We hope you like it.
9) Rents in Alicante's coastal areas will rise as demand for long-term rentals with sea views grows
The demand for coastal properties in Alicante is booming, especially for long-term rentals with sea views.
People are flocking to Alicante, drawn by its stunning coastal scenery and the rise of remote work, which allows them to enjoy a better quality of life. This shift is not just about tourists; many are choosing to live here, including remote workers and expatriates, all seeking that perfect sea view. The real estate market is feeling the pressure, with a noticeable shortage of long-term rental properties in these prime locations.
Rental prices in Alicante have been climbing steadily. Over the past year, the average rental price per square meter jumped by 14.3%, hitting a record high of €10.8. This trend isn't new; in the last two years, prices have surged by 40%, starting from €7.7 per square meter back in February 2022.
Tourism is another big player in this scenario. In early 2024, national tourism in Alicante saw a 9.29% increase in visitors between January and March. By October, the region had welcomed over 10 million international visitors, marking a 16.3% increase compared to the previous year. This influx of tourists is pushing more people to consider long-term stays, further driving up demand for rentals.
With more people eyeing Alicante for its lifestyle and views, the rental market is becoming increasingly competitive. The combination of tourism growth and the remote work trend is creating a perfect storm for rental prices to continue their upward trajectory. If you're considering a move, be prepared for a competitive market where sea views come at a premium.
Sources: The Olive Press, Euro Weekly News, Indomio, Travel and Tour World
10) Rental yields in Alicante's older neighborhoods will drop as new developments provide better amenities
In recent years, particularly in 2023 and 2024, Alicante has seen a noticeable shift in rental yields between older neighborhoods and newer developments. This change is largely due to the modern amenities offered by new constructions, which are increasingly attracting renters.
For example, older neighborhoods like Centro Tradicional have experienced a decline in rental yields. A 2-bedroom apartment from the 1970s in this area might offer a rental yield of around 4.53% to 4.57%. In contrast, newer developments such as those in Altozano provide higher yields, thanks to features like gated residences and swimming pools. These modern amenities make them more appealing to renters, who are willing to pay a premium for such conveniences.
Moreover, Alicante has been undergoing a surge in new construction, especially in areas like Vistahermosa and Benalúa Sur. These new developments come equipped with attractive features like infinity pools, gyms, and communal parking. Such amenities are not only desirable but also align with the preferences of today's renters, who are increasingly seeking contemporary living spaces.
Consumer preference surveys from the past few years have shown a clear shift towards properties with modern amenities. Renters are looking for smart technology features, energy-saving systems, and outdoor spaces, which are more commonly found in newer developments. This trend is further supported by demographic studies indicating an influx of younger renters who prioritize these modern features.
Sources: Gestali Home, Virto Property
11) Stricter rental rules in Alicante will affect short-term rental profits
In 2025, Alicante decided to tighten rental regulations, affecting short-term rental profits.
Locals were fed up with the noise and chaos from short-term rentals, a common gripe in tourist hotspots. The city council responded with a two-year ban on new holiday rental licenses starting January 2025. This move aimed to curb mass tourism's impact and protect local housing.
Residents' complaints weren't just about noise; unregulated short-term rentals were squeezing the housing market, making it tough for long-term residents to find homes. The new rules are a direct response to these housing shortages.
A report from the Alicante City Council showed that many homes were being used for short-term rentals without proper licenses. This highlighted the need for regulations to ensure these properties comply with local laws.
Local advocacy groups and media outlets have been vocal about the downsides of short-term rentals, adding pressure for change. The media spotlight on these issues helped push for stricter rules to protect the community's quality of life.
Sources: Short Term Rentalz, Travel and Tour World
Buying real estate in Alicante can be risky
An increasing number of foreign investors are showing interest. However, 90% of them will make mistakes. Avoid the pitfalls with our comprehensive guide.
12) Foreign investment in Alicante's older properties will drop as buyers favor modern, energy-efficient homes
In Alicante, foreign investors are increasingly drawn to modern, energy-efficient homes.
Thanks to the European Commission's Energy Efficiency Directive, there's a big push to cut energy use by 2030. Spain is on board, rolling out policies and incentives to boost energy-efficient buildings. The government is offering financial perks like tax breaks and grants for those who invest in energy-saving tech. Plus, the Technical Building Code now requires energy efficiency in new builds and major renovations, making these homes a hot ticket for buyers.
People are now more into homes with modern amenities and sustainability features. With remote work on the rise, there's a growing demand for tech-savvy, energy-efficient apartments. These homes, packed with smart tech and energy-saving systems, are a hit with young professionals and tech workers. This shift means older properties in Alicante aren't seeing the same value growth as their newer, greener counterparts.
In the real estate scene, energy-efficient homes are becoming the norm. Buyers, especially from abroad, are looking for properties that align with their eco-friendly values. This trend is reshaping the market, with a clear preference for homes that offer both comfort and sustainability.
For those eyeing a property in Alicante, it's worth noting that modern, energy-efficient homes are the future. The market is moving towards these types of properties, driven by both regulatory changes and consumer preferences. Older homes, while charming, may not offer the same appeal or investment potential.
As the demand for energy-efficient homes grows, foreign investment in older properties is likely to decline. Buyers are prioritizing modern features and sustainability, making these homes a more attractive option. This shift is expected to continue, shaping the future of Alicante's real estate market.
Sources: Energy Efficiency Directive, Billion Bricks, The Luxury Playbook
13) Mid-range property prices in Alicante will stay stable as local and international demand balance out
The mid-range property market in Alicante is expected to see stable prices due to a balance between local demand and international interest. In recent years, Alicante has become increasingly popular as a tourist destination, which has also attracted new residents seeking a better lifestyle. This trend suggests that local demand for properties is on the rise.
Additionally, the employment rate in Spain, particularly in regions like Andalusia where Alicante is located, has been improving. A stable and growing workforce contributes to local demand for housing, as more people are able to afford purchasing properties. This local demand is crucial in balancing the interest from international buyers.
International interest in Alicante remains strong, as evidenced by the significant rise in tourism numbers and the increase in housing prices beyond national averages. This sustained interest from international buyers supports the demand for properties, contributing to the stability of the market.
Sources: EURES Labour Market Information, Euro Weekly News, Euro Weekly News
14) Demand for senior-friendly housing in Alicante will grow as the population ages
The aging population in Alicante is on the rise, with a noticeable increase in residents over 90 years old.
In Spain, people are living longer, and by 2040, life expectancy is expected to hit 85.6 years. This means there's a growing need for homes that cater to older adults, featuring things like step-free access and wider doorways.
Right now, Spain has only about 10 independent living communities, which is far from enough. This shortage highlights a big opportunity for those interested in the senior housing market.
As the number of seniors grows, the demand for accessible and senior-friendly housing will increase. This is especially true in places like Alicante, where the aging population is becoming more prominent.
Investing in senior housing could be a smart move, as more people are looking for living spaces that support their independence and well-being. Features like easy access and home modifications are becoming essential.
For those considering buying property in the country, the aging trend in Alicante offers a unique opportunity to meet the needs of this growing demographic.
Sources: Euroweekly News, Macrotrends, PineBridge
We created this infographic to give you a simple idea of how much it costs to buy property in different parts of Spain. As you can see, it breaks down price ranges and property types for popular cities in the country. We hope this makes it easier to explore your options and understand the market.
15) Suburban rental yields in Alicante will drop as more people choose to buy homes there
In recent years, particularly in 2023 and 2024, there has been a noticeable shift in the real estate market in suburban areas of Alicante. More people have been choosing to buy homes rather than rent, driven by several key factors.
Firstly, the Spanish government has introduced policies and incentives that make it easier for first-time homebuyers to purchase properties. These measures, combined with favorable interest rates, have made homeownership more accessible and attractive. As a result, the demand for rental properties in these suburban areas has decreased.
Additionally, surveys and market analyses have shown a growing preference for homeownership over renting. People are increasingly valuing the long-term stability and financial benefits that come with owning a home, such as building equity and having control over their property. This shift in preference has contributed to the declining demand for rentals.
Furthermore, the construction of new homes in suburban Alicante has increased, providing more options for potential homeowners. This new supply of homes further supports the trend towards homeownership, reducing the need for rental properties.
Sources: Tupropertyinspain, Inmoinvestments
16) Beachfront property prices in Alicante will rise significantly as climate change boosts the appeal of coastal living
In recent years, we've seen a growing interest in coastal properties, and Alicante is no exception. Despite concerns about climate change, the demand for beachfront living has been on the rise. This is partly due to tax incentives and federal subsidies for beach nourishment projects, which have made these areas more attractive to wealthier individuals. As a result, housing prices in coastal communities have been increasing.
Looking back at 2023 and 2024, property prices in regions like Costa del Sol, which includes Alicante, were already on an upward trend. This was driven by sustained demand from international buyers, especially those seeking luxury properties or second homes. The appeal of a Mediterranean lifestyle, combined with a warm and sunny climate, has made Alicante a desirable location for retirees and remote workers. This trend is expected to continue, with more people looking for sustainable homes that offer environmentally conscious features.
Moreover, climate change is influencing migration patterns, with more people moving to areas with milder climates. Alicante's favorable weather conditions make it an attractive destination for those looking to escape harsher climates. This migration trend is likely to further increase demand for beachfront properties. Additionally, the economic benefits of tourism in coastal regions like Alicante cannot be overlooked. The area's beaches are a major draw for tourists, contributing significantly to the local economy and driving up property prices as investors seek to capitalize on the region's popularity.
Sources: Broadway Consulting, WHQR, Asset Folio
17) Demand for modern apartments in Alicante will rise as more young professionals move to urban areas
Alicante has been experiencing a significant growth in its tech and service sectors, which are particularly appealing to younger professionals. This growth is highlighted by the implementation of an intelligent traffic management system, funded by the ERDF, aimed at reducing congestion and pollution, making the city more livable and attractive for tech professionals.
The city has also seen a boom in coworking spaces, with around 80 operators across 262 spaces, covering roughly 5,100,000 sqm. This reflects a shift in work culture towards more flexible and remote-friendly environments, which is a trend that appeals to younger professionals seeking modern workspaces.
Population projections by the National Statistics Institute show a significant increase in the foreign population residing in Spain, including Alicante. This influx is expected to continue, driven by the demand for housing and modern apartments, as young professionals are drawn to the city's urban living options.
Real estate investments in Alicante are increasingly targeting younger buyers, with a focus on modern apartment complexes. The rental price indicators show considerable increases, indicating a high demand for housing that is both affordable and suitable for young professionals.
Sources: Shared Access, Euro Weekly News, CaixaBank Research, European Commission
While this article provides thoughtful analysis and insights based on credible and carefully selected sources, it is not, and should never be considered, financial advice. We put significant effort into researching, aggregating, and analyzing data to present you with an informed perspective. However, every analysis reflects subjective choices, such as the selection of sources and methodologies, and no single piece can encompass the full complexity of the market. Always conduct your own research, seek professional advice, and make decisions based on your own judgment. Any financial risks or losses remain your responsibility. Finally, please note that we are not affiliated to any of the sources provided. Our analysis remains then 100% impartial.