Should you buy a property in Alicante in 2025?

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

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INVESTROPA

A team specialized in real estate investing in European countries

We are a team of financial experts, legal professionals, developers, and local real estate specialists dedicated to helping people like you avoid mistakes when investing in real estate in a foreign place, particularly in Alicante. If you'd like to learn more about us, you can check our presentation page.

What types of properties are available in Alicante and what are their main features?

Alicante offers diverse property options suited to different budgets and lifestyle preferences.

Apartments and flats dominate the urban landscape, ranging from compact studios near the city center to luxury penthouses with sea views. Most modern apartments feature communal amenities like swimming pools, gardens, and underground parking.

Townhouses and bungalows combine traditional Spanish architecture with contemporary comforts. These properties typically include private terraces, small gardens, and sometimes access to shared facilities. They're particularly popular in suburban areas and coastal developments.

Villas represent the premium segment, ranging from modest three-bedroom properties with pools to expansive luxury estates overlooking the Mediterranean. Beachfront and hillside villas command the highest prices and strongest rental demand.

New build developments are increasingly common, especially in expanding neighborhoods, offering modern energy-efficient features, smart home technology, and contemporary design.

Does buying or renting make more financial sense in Alicante during 2025?

Buying property in Alicante currently offers superior financial advantages for most scenarios in 2025.

Property prices have risen 16.6% year-on-year as of June 2025, creating significant capital appreciation opportunities. Rental yields of 5-6% annually provide steady income streams for investors, while rental prices have surged 14.3% year-on-year, making long-term renting increasingly expensive for tenants.

For buyers planning to stay three years or longer, purchasing typically proves more cost-effective than renting. The combination of capital growth and rental income potential creates compelling investment returns, especially in prime locations like Playa de San Juan or the city center.

Renting remains sensible for short-term stays, newcomers exploring different neighborhoods, or those requiring maximum flexibility. However, rising rental costs and limited availability in desirable areas are pushing more people toward purchasing decisions.

It's something we develop in our Spain property pack.

What are current property prices in Alicante and how are they expected to change?

Property prices in Alicante have experienced remarkable growth throughout 2024 and into 2025. The city-wide average reached €2,477 per square meter as of June 2025, representing a 16.6% increase from the previous year.

Premium coastal districts like Playa de San Juan command €3,117 per square meter, while more affordable neighborhoods like Virgen del Remedio offer entry points around €960 per square meter. Over the past five years, prices have climbed 48% for existing properties and 37% for new builds.

Forecasts for the remainder of 2025 predict continued growth of 3-7% annually, driven by sustained international demand and limited supply in prime locations. New luxury developments and energy-efficient properties are experiencing particularly strong price appreciation.

What are the latest real estate market trends in Alicante?

Alicante's real estate market displays robust fundamentals with strong demand outpacing limited supply.

International buyers account for 44% of all property transactions in the province, with particularly strong interest from UK, German, Dutch, and Eastern European buyers. This foreign investment has intensified competition for prime properties, especially those with sea views or modern amenities.

Supply constraints are evident across all market segments, with well-located, energy-efficient properties experiencing bidding wars. New construction permits increased 8.5% in Q3 2024, but this additional supply hasn't kept pace with demand, particularly in coastal and city center areas.

The rental market shows exceptional strength, with both long-term and short-term rentals achieving high occupancy rates. Tourist rentals average €21,000 annual revenue with 75% occupancy rates, while long-term rentals in prime areas command €1,500-2,500 monthly for quality properties.

As of June 2025, market sentiment remains bullish, with both local and international investors actively seeking opportunities before prices rise further.

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What are the exact steps to buy property in Alicante as an international buyer?

Purchasing property in Alicante follows a structured process requiring careful documentation and professional guidance.

First, obtain your NIE (Número de Identidad de Extranjero), the essential foreigner identification number required for all property transactions. This process takes 2-4 weeks and can be completed at Spanish consulates abroad or police stations in Spain.

Second, open a Spanish bank account to facilitate payments and ongoing expenses. Non-resident accounts are readily available and essential for mortgage applications if financing is needed.

Third, secure financing if required. Spanish banks offer mortgages to non-residents covering up to 70% of property value, though interest rates may be higher than resident rates.

Fourth, engage qualified professionals including a property lawyer, real estate agent, and potentially a surveyor. Legal representation is crucial for due diligence, contract negotiations, and ensuring clean title transfer.

Fifth, make a formal offer and sign a reservation contract (contrato de arras), typically requiring a 10% deposit. This secures the property and begins the legal process.

Sixth, complete comprehensive legal checks including title verification, debt searches, and permit validation. Your lawyer will ensure the property has no legal encumbrances.

Finally, sign the purchase deed (escritura pública) at a notary office, paying the remaining balance plus associated taxes and fees. Property registration at the Land Registry completes the legal ownership transfer.

Who typically buys property in Alicante and what motivates them?

Alicante attracts a diverse international buyer profile seeking lifestyle enhancement and investment opportunities.

Retirees represent the largest buyer segment, particularly from the UK, Netherlands, Germany, and Belgium. They're drawn by the Mediterranean climate, excellent healthcare system, lower cost of living, and established expat communities providing social networks and support.

Digital nomads and remote workers form a growing segment since 2020, attracted by reliable internet infrastructure, co-working spaces, and work-life balance opportunities. Many initially rent before purchasing as they establish roots.

Property investors, both individual and institutional, seek Alicante's strong rental yields and capital appreciation potential. Buy-to-let investors target areas with consistent tourist demand, while longer-term investors focus on emerging neighborhoods with development potential.

Families relocate for quality of life improvements, international schooling options, and safe environments. They typically purchase larger properties in residential areas with good transport links to schools and amenities.

Second-home buyers want vacation properties for personal use and rental income during unused periods. These buyers often transition to permanent residence after retirement.

What are solid reasons to invest in Alicante property versus risky motivations?

Strong investment motivations for Alicante property center on fundamental market drivers and lifestyle benefits.

Robust rental yields of 5-6% annually, combined with consistent capital appreciation averaging 10-18% in recent years, create compelling financial returns. The diverse economy, international connectivity through Alicante-Elche Airport, and established tourism infrastructure provide economic stability.

Quality of life factors including 320 days of sunshine annually, Mediterranean climate, excellent healthcare, and rich cultural offerings attract consistent demand from international residents. The established legal framework protects foreign property owners with the same rights as Spanish citizens.

Weak or risky motivations include speculative quick-profit expectations, as property markets can experience cycles. Buying without visiting the area, understanding local regulations, or budgeting for additional costs often leads to disappointment.

Currency risk poses challenges for non-Euro buyers, while underestimating ongoing costs like property taxes, community fees, and maintenance can strain budgets. Ignoring rental licensing requirements for tourist lets can result in legal issues and financial penalties.

It's something we develop in our Spain property pack.

What can you realistically expect for different budget ranges in Alicante?

What common mistakes should buyers avoid in Alicante?

The most frequent mistake involves insufficient research and rushing purchase decisions without understanding local market conditions.

Many buyers underestimate total acquisition costs, which typically add 10-15% to the purchase price through taxes, notary fees, legal costs, and registration charges. Budgeting only for the property price creates financial strain during completion.

Purchasing without professional legal representation exposes buyers to title problems, outstanding debts, or permit issues. Spanish property law differs significantly from other countries, making local expertise essential.

Buying remotely without visiting the property and neighborhood often leads to disappointment. Photos and virtual tours cannot convey noise levels, building conditions, or area character adequately.

Overlooking ongoing costs like community fees, property taxes (IBI), and maintenance expenses can strain budgets. These costs vary significantly by property type and location, requiring careful calculation.

Ignoring rental regulations when planning buy-to-let investments can result in legal problems. Tourist rental licenses are required and increasingly restricted in some areas, while tenant rights differ from other countries.

Currency exchange timing for non-Euro buyers can significantly impact total costs. Large transactions benefit from professional currency services rather than standard bank transfers.

Which areas of Alicante offer the best investment opportunities in 2025?

We did some research and made this infographic to help you quickly compare rental yields of the major cities in Spain versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.

How profitable is long-term rental investment in Alicante?

Long-term rental investment in Alicante generates attractive returns with gross yields typically ranging from 5-6% annually.

Prime areas like Playa de San Juan and city center locations command highest rental rates, with quality two-bedroom apartments renting for €1,200-1,800 monthly. Three-bedroom properties in desirable areas achieve €1,500-2,500 monthly, depending on location and amenities.

Target tenant demographics include international professionals, university students, local families upgrading homes, and long-term expat residents. Tenants prioritize modern amenities, reliable internet, air conditioning, and proximity to transport links or beaches.

Successful buy-to-let properties feature contemporary kitchens, updated bathrooms, energy-efficient systems, and outdoor spaces like terraces or balconies. Properties near metro lines, major employers, or educational institutions maintain higher occupancy rates.

Rental management requires understanding Spanish tenancy laws, which favor tenant rights. Professional property management companies typically charge 8-12% of rental income but handle tenant relations, maintenance, and legal compliance.

It's something we develop in our Spain property pack.

How viable is short-term rental investment in Alicante?

Short-term rental investment in Alicante shows strong potential with average annual revenues around €21,000 and occupancy rates of 75%.

Top-performing areas include beachfront locations in Playa de San Juan, historic city center properties, and coastal developments in Santa Pola or Villajoyosa. Properties within walking distance of major attractions, restaurants, and transportation achieve premium nightly rates.

Guest expectations center on modern furnishings, reliable Wi-Fi, air conditioning, fully equipped kitchens, and outdoor spaces. Properties with sea views, pools, or unique architectural features command significant rate premiums during peak summer months.

Seasonal demand peaks from June through September, with shoulder seasons (April-May, October) maintaining moderate occupancy. Winter months see reduced demand but attract longer-stay guests including digital nomads and winter residents.

Regulatory compliance requires tourist rental licenses (VUT) from local authorities, with some municipalities restricting new licenses in saturated areas. Registration with national authorities became mandatory in 2025, requiring detailed guest reporting and tax obligations.

Professional management services handle guest communications, cleaning, maintenance, and regulatory compliance for 15-25% of gross revenue. Self-management requires significant time investment but maximizes profit margins for hands-on investors.

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.

Sources

1. Investropa - Alicante Real Estate Market Statistics 2025
2. Reuters Solicitors - Property Purchase 2025 in Alicante
3. Indomio - Real Estate Market Alicante
4. Investropa - 17 Strong Forecasts for Real Estate in Alicante 2025
5. Global Property Guide - Spain's Residential Property Market Analysis 2025
6. Euro Weekly News - Alicante's Property Boom: Why Prices Are Soaring
7. SpainEasy - Buying a House in Spain in 2025: A Guide for Foreign Buyers
8. Lawants - Buying a House in Spain as a Foreigner: Guide for 2025
9. The Leader - International Buyers Dominate Over 80% of the Alicante Property Market
10. Idealista - Alicante Emerges as a Rising Star in Spain's Luxury Real Estate Market