Authored by the expert who managed and guided the team behind the Spain Property Pack
Yes, the analysis of Malaga's property market is included in our pack
Where are the best places to invest in Málaga right now? Is the city center still the top pick, or are areas like El Palo, Teatinos, and La Malagueta gaining ground? What makes these locations attractive to both local and foreign investors?
We’re often asked these questions because we work directly with notaries, real estate agents, and clients who invest across the region. Our firsthand experience in these markets gives us unique insights into where the real opportunities lie. To save everyone from asking privately, we’ve written this article to share our knowledge broadly.
Our goal is to highlight the hottest markets in Málaga and explain why they’re worth your attention in 2025.
If you have suggestions or want us to dive deeper into a specific area, let us know. You shoot an email, we answer within 24 hours.
1) Campanillas, near Malaga, is gaining attention for its affordable land and potential for new residential developments
Campanillas, just outside Malaga, is catching eyes for its affordable land and potential for new homes.
With property prices in central Malaga soaring, reaching €2,833 per square meter in 2024, many buyers are looking to Campanillas for more budget-friendly options, where prices are around €2,071 per square meter.
Post-pandemic trends show a shift towards suburban living, with people craving larger spaces and a laid-back lifestyle. Campanillas fits the bill perfectly, offering a peaceful environment that’s hard to find in the city.
The local government is sweetening the deal with incentives for new developments, making it a hot spot for investors and developers eager to meet the rising demand for housing in Malaga.
Campanillas also boasts larger plots of land compared to the city center, ideal for new residential projects. Improved public transport links have made the area even more appealing.
With plans for thousands of new housing units, Campanillas is buzzing with activity. Real estate agents report a surge in interest, marking it as an emerging area with a positive trend in property prices.
Sources: Surinenglish.com, Idealista.com
Here is a cozy apartment balcony in Málaga, but just a short distance away in Campanillas, more spacious and affordable housing opportunities are attracting buyers. (Source: Hotelmix.es)
2) Carretera de Cádiz in Malaga is growing with its strategic location and new infrastructure developments
Carretera de Cádiz in Malaga is booming thanks to its prime location and fresh infrastructure.
Property prices here have jumped, with the average price per square meter in Malaga city, including Carretera de Cádiz, rising by 11.1% in 2024 to €2,169. This surge shows how much people want to live in this area.
Malaga's population is growing fast, adding over 12,000 new residents from October 2023 to October 2024. This increase is driving up the need for housing, and experts predict Malaga will lead in household growth over the next 15 years.
The city is also ramping up its public transport to keep up with the population boom, making Carretera de Cádiz even more connected and attractive. Government investments in infrastructure, like plans for a new development area with thousands of homes, are backing this growth.
These changes are turning Carretera de Cádiz into a hotspot for potential buyers, with its strategic location and improved amenities making it a top choice. The district's transformation is a testament to Malaga's commitment to accommodating its growing population and enhancing urban living.
With all these developments, Carretera de Cádiz is not just a place to live but a smart investment for the future. The district's evolution is a clear sign of its rising prominence in Malaga's real estate market.
Sources: Sur in English, 
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.
3) La Malagueta is gaining interest for its prime location near the city center and beach, with luxury apartment developments
La Malagueta is becoming a hot spot thanks to its prime location near the city center and the beach.
In 2023, Malaga's real estate market saw property prices jump by 19.1%, with the price per square meter hitting 3,262 euros by December. This upward trend continued into 2024, with a 9.4% increase in the first quarter, making La Malagueta even more appealing.
Luxury apartment developments are popping up in La Malagueta, like the sought-after Ikkil Bay villa complex. These new projects, along with improved infrastructure, are turning the area into a high-end real estate hotspot.
Properties near the beach and city center are in high demand, with 30% of listings on Idealista selling within a month in 2024. This demand is driven by Malaga's booming tourism, which keeps interest in La Malagueta strong.
Sources: Sun Properties Marbella, Pure Living Properties, Guide to Malaga
4) Pedregalejo is attracting buyers with its traditional charm and seaside appeal, offering vacation homes with strong rental potential
Pedregalejo is quickly becoming a favorite spot for vacation home buyers due to its traditional charm and seaside appeal.
In recent months, property prices in Pedregalejo have surged, with the average rent per square meter jumping by 14.4% since April 2023. This uptick signals a growing interest in the area, making it a hot investment opportunity for those eyeing the real estate market.
Malaga, along with its neighboring areas, is seeing a tourism boom, with 14.4 million tourists visiting in 2024, marking a 3.17% increase from the previous year. This influx, especially from the UK, Germany, and the US, is driving up the demand for short-term rentals, which in turn boosts the rental potential of vacation homes in Pedregalejo.
Pedregalejo stands out with rental yields that are notably higher than the Malaga average, offering returns of up to 9% over five years. This is backed by strong occupancy rates and an average daily rate of $157.6, leading to an annual revenue of $21.8K. Such numbers underscore the area's strong rental potential, making it a prime spot for investment.
For those considering a purchase, Pedregalejo offers a unique blend of local culture and modern amenities, making it not just a place to stay, but a place to experience. The area’s vibrant community and picturesque views add to its allure, drawing in both tourists and potential property buyers.
With its strategic location and growing popularity, Pedregalejo is more than just a vacation spot; it's a promising investment with strong rental returns and a steady stream of tourists eager to experience its charm.
Sources: Sur in English, Guide to Malaga, Hostaway
5) El Palo in Malaga is gaining popularity for its affordable beachfront properties and appreciation potential
El Palo in Malaga is becoming a hotspot for affordable beachfront properties.
In 2023 and 2024, property sales in El Palo surged, with the average price per square meter at €2,200. This is a steal compared to Playa de la Malagueta, where prices soar to €4,600 per square meter. The affordability is drawing in a wave of international buyers.
El Palo's charm is not just in its prices. Its strategic spot on the Costa del Sol, with excellent transport links like a major airport and high-speed trains, makes it a convenient choice for buyers from all over. This ease of access is a big draw for those looking to invest.
The local government is also stepping up, investing in infrastructure and amenities that boost El Palo's appeal. With ongoing gentrification and new transport links, the area is ripe for property value appreciation. These changes are making El Palo not just a great place to live, but a smart investment.
Insider tip: the planned redevelopment projects are set to transform the area even more, enhancing its potential for future growth. This makes El Palo a promising spot for those looking to get in early on a rising market.
Sources: HRBO, Veles Property
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6) Málaga Este is gaining popularity for its scenic views and luxury real estate opportunities
Málaga Este is a hotspot for stunning views and luxury real estate, drawing in both local and international buyers.
In 2023, property prices in Málaga, including Málaga Este, jumped by 19.1%, hitting 3,262 euros per square meter. This is well above the national average, showing just how in-demand this area is. The buzz is expected to keep growing into 2024, as Málaga's charm as a tourist magnet continues to boost interest in holiday homes and investment properties, especially in upscale spots like Málaga Este.
Foreign buyers are a big part of this trend, making up 33.5% of apartment sales in Málaga, which is twice the national average. Málaga Este is a favorite among international buyers, who are particularly interested in luxury properties. The rise of high-end housing projects in neighborhoods like Soho has only added to the allure, especially as travel picks up post-pandemic.
Tourism numbers back this up, with the Costa del Sol, including Málaga Este, seeing a record number of tourists in 2024. This surge in visitors highlights the district's appeal, with its breathtaking views and coastal vibe, making it even more attractive to potential buyers.
Sources: Sun Properties Marbella, Sur in English, DM Properties
7) Soho, Malaga's "Arts District," is gaining attention for its trendy vibe and rising property values
Soho in Malaga, known as the "Arts District," is catching the eye of investors due to its trendy vibe and rising property values.
In Soho, the average property price has climbed to €4,009/m², a clear sign of high demand. This surge is part of a broader trend in Malaga, where property prices have jumped by 16.29% from January 2023 to January 2024. The area’s transformation into a cultural hotspot, with new art galleries and cultural venues, has significantly boosted its appeal.
Soho's artsy and vibrant atmosphere is a magnet for both local and international investors. The neighborhood's cultural renaissance, marked by new museums and events, draws affluent buyers who are keen on the lifestyle and amenities. This shift from a rundown area to a cultural hub has made Soho a prime spot for investment.
Malaga's ongoing popularity as a tourist destination further fuels the demand for properties in Soho. The city’s ideal climate and rich artistic, cultural, and historical heritage continue to attract tourists, which in turn increases interest in residential properties. Real estate agents have noticed a spike in buyer interest, pointing to Soho's trendy vibe as a key factor.
Investors are particularly drawn to Soho's unique blend of culture and modernity. The area’s transformation has not only increased property values but also enhanced its reputation as a desirable place to live. This makes Soho an attractive option for those looking to invest in a vibrant and culturally rich environment.
With its rising property values and cultural appeal, Soho is becoming a hotspot for savvy investors. The neighborhood's ongoing development and popularity among tourists and locals alike make it a promising area for real estate investment.
8) Teatinos in Malaga is booming with demand for its proximity to the university and high rental yields
Teatinos in Malaga is buzzing with interest, thanks to its close proximity to the University of Malaga.
In 2024, property prices in Teatinos-Universidad hit €3,517 per square meter, marking a 23.27% jump from the previous year. This spike shows just how hot the market is getting.
Rental yields are also climbing. By October 2024, the average rent reached €13.67 per square meter, up 4.27% from the year before. This makes Teatinos a prime spot for investors looking to cash in on rental properties.
Students flock to the area because of the university, which naturally boosts housing demand. While we don't have exact numbers on student growth, the location itself is a magnet for both students and investors.
Real estate experts consistently highlight Teatinos as a high-demand area, largely due to its strategic location near the university.
Sources: Indomio, Sur in English, Dream Property
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.