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As we reach mid-2025, Madrid's apartment market continues to show strong momentum with average prices ranging from €4,500 to €6,600 per square meter citywide.
The Spanish capital's real estate sector has experienced significant growth, with premium neighborhoods like Salamanca commanding over €9,400 per square meter while affordable districts like Villaverde offer opportunities at around €2,300 per square meter. Understanding these price variations, transaction costs, and market trends is essential for anyone considering purchasing an apartment in Madrid for investment or personal use.
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Madrid apartment prices averaged €6,021 per square meter in April 2025, representing a 38% increase from the previous year, with luxury districts like Salamanca reaching €9,417 per square meter.
New build apartments command a 44% premium over resale properties, while total transaction costs typically add 10-15% to the purchase price through taxes, notary fees, and other expenses.
| Category | Price Range | Details |
|---|---|---|
| Average Price per sqm | €4,500 - €6,600 | Citywide average, premium areas exceed €9,000 |
| Most Expensive Areas | €7,000 - €9,417 | Salamanca, Chamberí, Retiro, Centro |
| Most Affordable Areas | €2,300 - €3,500 | Villaverde, Usera, Carabanchel, Puente de Vallecas |
| New Build Premium | +44% | Above resale property prices |
| Transaction Costs | 10-15% | Includes taxes, notary, registry fees |
| Annual Growth (2025) | +37.97% | Year-over-year price increase |
| Rental Yields | 4.8% - 6.6% | Higher yields in affordable districts |
What is the current average price per square meter for apartments in Madrid?
The Madrid apartment market shows significant price variation depending on data sources and property types, with citywide averages ranging from €4,500 to €6,600 per square meter as of June 2025.
According to the latest market data, Madrid apartments averaged €6,021 per square meter in April 2025, representing a substantial 37.97% increase compared to April 2024. This figure reflects the strong demand and limited supply dynamics affecting the Spanish capital's residential market.
Premium central neighborhoods consistently command higher prices, with quality apartments in areas like Salamanca, Chamberí, and Retiro typically exceeding €6,000 per square meter. In the most exclusive districts, prices can reach €9,417 per square meter, as seen in Salamanca during April 2025. These premium areas benefit from superior location, amenities, and prestige that justify the price premium.
More affordable options exist in peripheral districts, where prices range from €2,300 to €3,500 per square meter depending on property condition and exact location. Districts like Villaverde, Usera, and Carabanchel offer entry-level opportunities for buyers seeking value in the Madrid market.
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How do apartment prices vary by neighborhood or district in Madrid?
Madrid's real estate market demonstrates dramatic price disparities across its 21 districts, with premium areas commanding prices up to four times higher than affordable neighborhoods.
| District Category | Price Range (€/sqm) | Key Areas |
|---|---|---|
| Premium Districts | €7,000 - €9,417 | Salamanca, Chamberí, Retiro, Centro |
| Mid-Range Districts | €4,000 - €6,000 | Malasaña, Chueca, La Latina |
| Affordable Districts | €2,300 - €3,500 | Villaverde, Usera, Carabanchel |
| Emerging Areas | €3,500 - €5,000 | Tetuán, San Blas-Canillejas |
| Outer Districts | €2,000 - €4,000 | Puente de Vallecas, Villa de Vallecas |
What are the differences in price per square meter between new builds and older apartments?
New build apartments in Madrid command a significant premium over resale properties, with prices typically 44% higher than existing apartments.
This substantial price difference reflects several factors including modern amenities, energy efficiency, updated building codes, and the prestige associated with new construction. New build apartments in central Madrid locations frequently exceed €5,000 per square meter, often reaching €6,000 or more in prime areas.
Resale apartments offer better value for money, with citywide averages closer to €4,500 per square meter. However, buyers should consider potential renovation costs and energy efficiency upgrades when evaluating older properties. The age and condition of resale apartments vary significantly, creating opportunities for different budget levels.
The new build premium reflects market demand for modern living standards, including improved insulation, updated electrical systems, modern kitchens and bathrooms, and compliance with current building regulations. Buyers willing to invest in new construction benefit from reduced maintenance needs and higher energy efficiency ratings.
What is the typical total purchase price for a standard apartment, including taxes, notary, and other transaction fees?
A standard 80-100 square meter apartment in central Madrid typically costs between €360,000 and €650,000, with total transaction costs adding 10-15% to the purchase price.
For a representative €400,000 apartment purchase, buyers should budget an additional €40,000 to €60,000 in transaction costs. These expenses include property transfer tax (ITP) at 6% for resale properties or VAT (IVA) at 10% for new builds, plus stamp duty (AJD) of 0.75-2% for new properties.
Notary fees range from 0.1% to 0.4% of the purchase price depending on property value, while land registry fees typically cost 0.1% to 0.25%. Legal fees, highly recommended for foreign buyers, usually amount to 1-2% of the purchase price.
Additional costs may include property surveys, utility connections, home insurance, and real estate agency fees. Agency fees in Madrid typically equal one month's rent or 1-2% of the purchase price, though these are often included in the advertised property price.
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What are the average costs of owning an apartment in Madrid, including maintenance, community fees, and property taxes?
Madrid apartment ownership involves several recurring costs that buyers must factor into their investment calculations, with total annual expenses typically ranging from €2,000 to €6,000 depending on property size and location.
Community fees represent the largest ongoing expense, ranging from €50 to €350 per month depending on building amenities and services. Buildings with elevators, security, pools, or gyms command higher fees, while basic residential buildings charge minimal amounts for essential maintenance and cleaning.
Property tax (IBI) costs €300 to €1,000 annually for typical apartments, calculated based on the property's cadastral value. This municipal tax funds local services and infrastructure, with rates varying slightly between Madrid districts.
Utility costs including electricity, water, and gas typically total €80 to €150 monthly for average apartments. Energy costs vary seasonally, with heating expenses higher during Madrid's winter months. Property insurance, while optional, costs €200 to €500 annually and provides valuable protection for owners.
Maintenance and repair costs vary significantly based on property age and condition, but owners should budget €500 to €2,000 annually for unexpected repairs and periodic upgrades.
How have apartment prices in Madrid evolved over the past year and the past five years?
Madrid's apartment market has experienced exceptional growth, with prices rising 37.97% in the year to April 2025, following a 19.8% increase in 2024.
This acceleration represents a significant shift from the more moderate growth seen in previous years. The Madrid residential market reached peak pricing in April 2025 at €6,021 per square meter, compared to €3,933 per square meter in June 2023, representing over 50% growth in less than two years.
The five-year trend shows consistent upward momentum, with average prices rising from approximately €3,140 per square meter in 2022 to current levels exceeding €6,000 per square meter. This represents cumulative growth of over 90% since 2022, making Madrid one of Europe's fastest-appreciating property markets.
Supply constraints, strong employment growth, and increased international investment have driven this rapid appreciation. The trend has affected all market segments, though luxury properties have seen the most dramatic increases, with some premium areas experiencing triple-digit percentage gains over the five-year period.
What are the price forecasts for apartments in Madrid over the next 1, 5, and 10 years?
BBVA Research projects continued strong growth in Madrid apartment prices, forecasting a 7.3% increase in 2025 and 5.3% growth in 2026, reflecting ongoing supply-demand imbalances.
Short-term forecasts through 2026 anticipate sustained growth driven by employment opportunities, limited housing supply, and continued international investment interest. These projections suggest Madrid apartment prices could reach €6,500 to €7,000 per square meter by end-2026.
Five-year projections indicate potential cumulative growth of 20-30% if current market conditions persist, potentially pushing average prices toward €8,000 per square meter by 2030. However, this assumes continued economic growth, stable interest rates, and no major regulatory interventions in the housing market.
Ten-year forecasts remain more speculative, but demographic trends, urbanization, and Madrid's growing international profile suggest continued long-term appreciation. Regulatory changes targeting housing affordability or supply-side interventions could moderate growth rates in the latter part of the decade.
Investors should consider that such rapid growth rates may not be sustainable indefinitely, and periodic market corrections remain possible despite the overall positive trajectory.
How do apartment prices in Madrid compare to similar major European cities like Barcelona, Lisbon, or Milan?
Madrid's apartment prices position the city competitively within the European market, though costs vary significantly compared to peer cities depending on specific neighborhoods and property types.
Barcelona commands higher average prices than Madrid, with apartment costs ranging from €5,562 to €7,400 per square meter compared to Madrid's €4,545 to €6,565 range. Barcelona's coastal location, tourism appeal, and international recognition contribute to this premium, though both cities show similar growth trajectories.
Lisbon offers comparable pricing to Madrid's mid-range, with central areas averaging €5,000 to €6,000 per square meter. Portugal's Golden Visa program and growing tech sector have driven significant appreciation in Lisbon, making it competitive with Madrid for international buyers.
Milan represents a significantly more expensive market, with average apartment prices around €9,154 per square meter, nearly double Madrid's average. Milan's role as Italy's economic capital and fashion hub justifies premium pricing, though Madrid offers better value for money.
Among these peer cities, Madrid provides attractive investment opportunities with strong growth potential while maintaining relative affordability compared to Milan and premium Barcelona neighborhoods.
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Which areas in Madrid are considered the most expensive, the most affordable, and the most promising for future growth?
Madrid's property market offers distinct opportunities across different price segments, with clear leaders in luxury, value, and growth potential categories.
| Category | Districts | Price Range (€/sqm) |
|---|---|---|
| Most Expensive | Salamanca, Chamberí, Retiro, Centro | €7,000 - €9,417 |
| Most Affordable | Villaverde, Usera, Carabanchel, Puente de Vallecas | €2,300 - €3,500 |
| Most Promising Growth | Retiro, Chamberí, Tetuán, San Blas-Canillejas | €3,500 - €7,000 |
| Emerging Areas | Carabanchel, Villa de Vallecas | €2,500 - €4,000 |
| Stable Premium | Malasaña, Chueca, La Latina | €4,500 - €6,500 |
What are the best types of apartments or locations to consider if I want to live in the property myself?
For owner-occupiers seeking quality of life, central districts like Salamanca, Retiro, and Chamberí offer the best combination of convenience, amenities, and safety, despite higher purchase prices.
Salamanca district provides upscale living with excellent shopping, dining, and transport connections, making it ideal for professionals and families who prioritize luxury and convenience. Properties here typically cost €7,000 to €9,000 per square meter but offer prestige and strong resale value.
Retiro district appeals to families and those seeking tranquility, with proximity to El Retiro Park and excellent schools. Chamberí offers traditional Madrid charm with beautiful architecture and community atmosphere, perfect for those wanting authentic Spanish neighborhood life.
Trendy areas like Malasaña and Chueca attract young professionals and creatives, offering vibrant nightlife, cultural attractions, and relatively affordable prices compared to luxury districts. These neighborhoods provide excellent rental potential if owners travel frequently.
For families prioritizing space and value, outer districts with good transport connections offer larger apartments at lower prices, though commute times to central Madrid increase accordingly.
What are the smartest choices in terms of apartments for rental income — both for short-term and long-term strategies?
Madrid's rental market offers different optimization strategies depending on investment timeline and management preferences, with certain districts providing superior yields for each approach.
Short-term rental opportunities perform best in central tourist areas like Centro, Malasaña, and Chueca, where business travelers and tourists pay premium rates. These locations command higher nightly rates but require active management and face regulatory restrictions on tourist apartments.
Long-term rental investments achieve optimal returns in affordable districts like Carabanchel, Usera, and Villaverde, where purchase prices remain low while rental demand stays strong. These areas often generate gross rental yields exceeding 6%, significantly above Madrid's 4.8% average.
Tetuán district offers attractive long-term rental opportunities with good transport connections and growing international resident population, providing stable tenant demand and moderate price appreciation potential.
Professional tenants prefer areas with easy access to business districts, making properties near metro stations in mid-range neighborhoods particularly attractive for long-term strategies. Universities and international companies create consistent rental demand in these areas.
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What types of apartments and areas are currently the most attractive for buying, renovating, and reselling at a profit?
Renovation and resale strategies work best in undervalued neighborhoods with gentrification potential, particularly older apartments in districts like Carabanchel, Usera, and parts of Tetuán.
These areas offer properties at €2,300 to €4,000 per square meter that can be renovated and repositioned in the market. Key success factors include proximity to transport links, emerging cultural attractions, and evidence of neighborhood improvement trends.
Older apartments in central areas also present opportunities, particularly properties requiring energy efficiency upgrades or modernization. Buildings from the 1960s-1980s often have solid construction but outdated amenities, creating value-add potential through strategic renovation.
Properties near new infrastructure developments, such as metro extensions or urban regeneration projects, offer the best appreciation potential. Investors should research municipal development plans to identify areas benefiting from future improvements.
The renovation strategy requires careful cost control, with typical improvement budgets ranging from €300 to €800 per square meter depending on scope. Energy efficiency certificates and modern amenities significantly impact resale values in Madrid's competitive market.
Success in this strategy depends on market timing, renovation quality, and understanding buyer preferences in each specific neighborhood segment.
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
Madrid's apartment market demonstrates exceptional dynamism in 2025, with average prices reaching €6,021 per square meter and annual growth exceeding 37%.
The significant price variations across districts, ranging from €2,300 in Villaverde to €9,417 in Salamanca, create opportunities for different investment strategies and budgets in Spain's capital.
It's something we develop in our Spain property pack.
Sources
- Indomio - Madrid Real Estate Market
- Numbeo - Property Prices in Madrid
- Statista - Madrid Housing Prices by District
- Idealista - Property Buying Costs Spain 2025
- Madrid Estate - Real Estate Taxes
- Spanish Property Insight - Property Taxes Guide
- Global Property Guide - Spain Square Meter Prices
- Relocate.me - Cost of Living Madrid