Authored by the expert who managed and guided the team behind the Spain Property Pack
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What will happen in Valencia’s real estate market? Will prices go up or down? Is Valencia 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 Valencia, 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.
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1) Interest in Malvarrosa properties will drop due to environmental worries about rising sea levels
Rising sea levels are a growing concern for coastal areas like the Malvarrosa neighborhood in Valencia.
Experts predict that by 2030, the sea level in Valencia could rise by 0.11 meters, and by 2090, it might reach 0.41 meters. This spells trouble for low-lying areas, making them more prone to flooding.
Climate Central's research shows that parts of Valencia, including Malvarrosa, are at risk of being underwater by 2050. The severe flooding in Valencia in October 2024, driven by ocean warming, highlights the increasing threat. Insurance companies are likely to hike premiums for properties in these flood-prone zones, which could make them less appealing to buyers.
Real estate trends indicate that property values in coastal areas are dropping due to the rising flood risks. More buyers are steering clear of high-risk areas like Malvarrosa as they become more aware of the environmental dangers. Media reports on climate change impacts, such as frequent flooding and rising sea levels in Valencia, further discourage potential buyers from investing in Malvarrosa properties.
Sources: The Olive Press, The Olive Press, Climate Central
2) Rental yields in Valencia’s city center will rise as short-term rentals become more popular with tourists
In recent years, Valencia has experienced a significant increase in the number of tourists visiting the city. In 2022, approximately 4.5 million tourists visited Valencia, up from 4.1 million in 2019. This continuous growth in tourism has driven demand for short-term rentals, making Valencia an increasingly popular destination for accommodation.
As of 2023, there were over 7,000 Airbnb apartment listings in Valencia, marking a 15% annual increase in supply. By 2024, this number had risen to 7,995 active listings, with a median occupancy rate of 80% and an average daily rate of €93. This rising popularity of short-term rental platforms like Airbnb is contributing to higher rental yields in the city center.
Short-term rentals in Valencia typically generate double the monthly cash flow compared to traditional long-term rentals, making them highly profitable. The gross rental yield in Valencia City averages 8%, with some districts offering rates between 8.3 and 11.4%. This comparative analysis shows that short-term rentals can provide higher rental yields, attracting more investors to the market.
While there are regulations on short-term rentals, enforcement has not been strict, allowing for a lenient environment. However, stricter regulations are being enforced, which could limit supply and drive up prices and occupancy rates for compliant listings. This regulatory environment makes short-term rentals even more attractive for investors.
Sources: Dream Properties Valencia, Airbtics, Monserrate Inmobiliaria, Revalencia, Bluekey Homes
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) Rental yields in student housing will increase as more international students enroll
The rental yields in the student housing sector are expected to rise due to the growing number of international students in Valencia. In the past, specifically during the 2023-2024 academic year, Berklee Valencia alone welcomed 290 students from 47 different countries. This influx is part of a larger trend, as Spanish universities saw a record high of 224,080 international students in the 2021/22 academic year.
The demand for student accommodation in Valencia has been increasing, driven by the rising number of students, particularly international ones. This surge in demand is not just a local phenomenon but is also seen in other regions like Madrid and Catalonia. However, the supply of student housing remains limited, with less than 110,000 beds available across Spain, which is expected to push rental yields higher.
International students often prefer renting over buying due to the temporary nature of their stay, further fueling the demand for rental properties. Additionally, real estate market analyses have predicted growth in rental yields, supported by the expansion of student housing projects and the increasing number of international students choosing Valencia as their study destination.
Sources: ICEF Monitor, Berklee Valencia, CoStar
4) Property values in Campanar will rise as public transportation improves
In recent years, the Campanar area in Valencia has been set to experience a boost in property values, largely due to improved public transportation links. This is primarily because the European Investment Bank (EIB) has provided significant funding for public transportation improvements in Valencia. For instance, in 2025, a €69 million loan was secured to expand the city’s fleet of zero-emissions electric buses, which includes the purchase of 145 new electric buses and necessary infrastructure upgrades.
Historically, areas with improved transportation links have seen rising property values. In Valencia, real estate prices have been increasing significantly, especially in neighborhoods with enhanced transportation access. For example, the city has witnessed an 11.2% year-on-year increase in house prices, with some neighborhoods experiencing price hikes of over 15%. This trend suggests that Campanar could follow a similar pattern.
Moreover, real estate market reports indicate strong growth in areas with better public transport access. In Valencia City, the gross rental yield averages 8%, with districts like Campanar showing returns between 8.3 and 11.4%. This increased demand for properties with good transport connections is a key factor in boosting property values.
Sources: Sustainable Bus, Dream Properties Valencia
5) Foreign investment in eco-friendly homes will grow in Valencia
Valencia is set to see a rise in foreign investment in eco-friendly residential developments for several reasons. First, there's a growing demand for sustainable housing in Spain, especially in popular areas like Valencia. This demand is driven by improved economic conditions and rising disposable incomes, which have led to increased housing prices and sales volumes.
Additionally, Valencia has been actively promoting sustainable tourism and development. Initiatives like the collaboration between TM Real Estate Group, Valencia CF, and LaLiga highlight the region's commitment to sustainable construction and residential tourism. This focus on sustainability is attracting attention from international investors.
Moreover, the government is offering incentives for green building practices as part of its mission to become carbon neutral by 2030. This includes integrating adaptation policies into development strategies, aligning with regional and national goals. Such incentives make eco-friendly projects more appealing to foreign investors.
Valencia's reputation as a desirable location for expatriates, combined with its commitment to sustainability, further enhances its attractiveness. The city's European Green Capital status and various green initiatives underscore its dedication to eco-friendly living, drawing in investors interested in sustainable developments.
Sources: Valencia CF, Bravos Estate, Climate Adapt, Euronews
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6) Property demand in Mestalla will rise as the football stadium area is redeveloped
The Mestalla neighborhood is set to experience a surge in property demand due to the redevelopment of the football stadium area. This transformation is largely driven by significant investments, such as the €300 million secured by Valencia CF for the Nou Mestalla project. This includes €80 million from the CVC agreement and €30 million from the sale of VIP boxes, showcasing a substantial financial commitment to the area.
Real estate developers are showing increased interest, as evidenced by the sale of land to Atitlan Desarrollos Inmobiliarios for €30 million to €40 million. This interest is further supported by the development of two tower blocks that will house a hotel, offices, and commercial premises, which will increase pedestrian traffic and enhance the area's appeal.
Improved infrastructure and amenities are also key factors. The Nou Mestalla project includes a municipal sports center and a large square, along with experiential restaurants, leisure activities, and a museum. These enhancements will make the area more attractive to potential residents and investors.
Sources: Football Espana, The Stadium Business, The Stadium Business
7) Stricter short-term rental rules will be enforced to tackle housing shortages in the city
In recent years, Valencia has seen a significant rise in housing prices, with the average rental price reaching €14.14/m² by August 2023, marking a 35.31% increase from the previous year. This sharp increase in rental prices is a clear indicator of the growing housing shortage in the city.
The demand for long-term rental properties has been increasing, driven by Valencia's popularity among foreigners and the city's appealing lifestyle. However, the supply of these properties has not kept pace with demand, leading to higher rental prices and increased competition for available housing.
One of the contributing factors to this housing shortage is the growing number of short-term rental listings on platforms like Airbnb. These short-term rentals reduce the availability of long-term rental properties, making it more difficult for local residents to find affordable housing. Additionally, local communities have raised concerns about the noise and disruption caused by these short-term rentals, further highlighting the need for stricter regulations.
Sources: BNB Calc, Iberian Property, Bluekey Homes, Dream Properties Valencia
8) Property prices in Valencia's suburbs will dip slightly as urban living gains popularity
Valencia's suburban property prices are expected to dip as city living gains popularity.
In the heart of Valencia, property prices have surged by 11.2% in 2024, outpacing the broader Comunidad Valenciana's 7.1% increase. This trend highlights a growing preference for urban life, where the hustle and bustle of the city is becoming more appealing.
Rental costs in central Valencia are climbing too, with Ciutat Vella leading the charge at over €3,000/m². This indicates that people are willing to pay more for the convenience and vibrancy of city living, making urban areas a hot commodity.
Valencia is not just relying on its charm; it's actively enhancing its urban appeal. The city is investing in its future with a €69 million loan from the European Investment Bank to boost its fleet of zero-emissions electric buses. This move aims to create a modern, eco-friendly transport network by 2028, making city life even more attractive.
These developments suggest that Valencia is positioning itself as a desirable urban hub, drawing more residents to its city center. As a result, suburban areas might see a slight decline in property prices as the allure of urban living continues to grow.
Sources: Dream Properties Valencia, Dream Properties Valencia, Sustainable Bus
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.
9) Valencia’s property prices will keep rising steadily because demand is higher than supply
Valencia's residential property prices have been on a steady rise, and this trend is expected to continue. In 2024, the average price for residential properties in Valencia increased by 13.06% from the previous year, reaching €2,520 per square meter. This significant rise in property prices is a clear indicator of the strong demand in the market.
One of the key factors driving this demand is the increasing number of foreign buyers investing in Valencia. These buyers are attracted to the city's vibrant culture and economic opportunities, contributing to the high demand for residential properties. Additionally, Valencia's popularity as a relocation destination has been well-documented, with both locals and foreigners finding the city appealing.
On the supply side, there is a limited availability of new housing developments. Construction starts in Valencia have decreased significantly, down 75% year-over-year in the third quarter. This shortage of new housing developments means that the supply is not keeping up with the growing demand, further driving up property prices.
Moreover, the region is experiencing economic growth, which is another factor contributing to the rising demand for residential properties. As more people move to Valencia for its economic opportunities, the demand for housing continues to increase. Real estate market analyses predict that this demand will continue to outpace supply, leading to further price increases.
Sources: Indomio, Dream Properties Valencia
10) Property demand in Ruzafa will rise due to its lively culture and closeness to the city center
The Ruzafa neighborhood in Valencia is becoming a hot spot for property buyers, thanks to its vibrant cultural scene and prime location near the city center.
In 2023 and 2024, Ruzafa saw a 10.1% increase in property prices, with the average price per square meter hitting €2,809 in early 2024. This jump in prices shows just how much people want to live here. The neighborhood's charm is undeniable, with events like the Russafira Music & Crafts Fair, which took place in June 2023, highlighting its cultural diversity. This fair featured everything from live music to storytelling, making it a true celebration of Ruzafa's unique vibe.
Ruzafa's food scene is another big draw. With popular spots like Canalla Bistro and the lively Market Russafa, the area is a magnet for both locals and tourists. These culinary hotspots not only offer delicious food but also add to the neighborhood's overall appeal, making it a place where people want to spend time and, ultimately, live.
One of Ruzafa's biggest selling points is its proximity to the city center and excellent public transport links. This makes it super convenient for residents and visitors alike. The ease of getting around, combined with the area's cultural offerings, attracts young professionals and creatives. This influx of new residents is changing the neighborhood's demographic, adding to the buzz and increasing interest in living in Ruzafa.
For those considering buying property in Valencia, Ruzafa offers a unique blend of culture, convenience, and community. The neighborhood's ongoing transformation and rising property values make it an attractive option for potential buyers. With its rich cultural events and culinary delights, Ruzafa is more than just a place to live; it's a lifestyle choice.
As the demand for property in Ruzafa continues to grow, it's clear that this neighborhood is on the rise. Its strategic location and vibrant atmosphere make it a top choice for those looking to invest in Valencia's real estate market.
Sources: Advocate Abroad, 247 Valencia, Visit Valencia
11) Rental yields in Valencia's coastal areas will rise as remote work leads to longer stays
The rental market in Valencia's coastal areas is poised for a boost in yields, largely due to the ongoing trends in remote work. In 2023, Valencia saw a significant increase in rental prices, with the average standing at €14.14/m², marking a 35.31% rise from the previous year. This uptick indicates a growing demand for rental properties, particularly those that cater to remote workers.
Valencia has become a hotspot for digital nomads, thanks to its thriving tech scene and the widespread adoption of remote work by companies. This trend has made the city an attractive destination for those seeking flexible work arrangements. The Spanish government's initiatives, such as the new Housing Law, have further bolstered Valencia's appeal by promoting remote work and offering tenant protections.
Moreover, the rental market trends show that renters are staying longer in Valencia, with prices continuing to rise. This suggests that the coastal areas, with their pleasant climate and extensive services, are particularly appealing to remote workers. As a result, property owners in these regions are likely experiencing higher yields due to increased occupancy rates and demand for remote work-friendly accommodations.
Sources: Bluekey Homes, New Business, Savills
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12) More foreign retirees will buy property in Valencia as it becomes a popular retirement spot
Valencia has become a top choice for retirees, especially after being ranked as the premier overseas retirement destination in 2024. This recognition highlights its growing appeal among foreign retirees looking for a new place to settle down.
The property market in Spain, including Valencia, showed strong growth in 2024, with new home prices increasing significantly. This trend indicates a healthy real estate market, which is attractive to foreign buyers, including retirees.
Valencia's airport has expanded its connectivity, making it easier for retirees to travel to and from the city. This improved accessibility is a key factor in attracting more foreign retirees to purchase property in the area.
Valencia is also known for its affordable cost of living compared to other European cities, making it an attractive option for retirees on a budget. The lower costs for housing, food, and transportation add to its appeal.
Testimonials from current foreign retirees in Valencia praise the city's climate, lifestyle, and welcoming environment. These positive reviews contribute to its reputation as a desirable retirement destination.
Sources: CNN Valencia, Think Spain, Spain Travel News, Moving To, Spend Life Traveling
13) Demand for student housing in the city will grow as more international students arrive
The influx of international students will increase demand for student accommodation in the city for several reasons.
First, there has been a significant rise in international student enrollment in Valencia's universities. For example, Valencia College has seen a notable increase in international students, thanks to its intensive English programs and exchange visitor programs that attract students from over 50 countries. This growing number of students naturally leads to a higher demand for places to live.
Additionally, the number of international students in Spanish universities reached a record high in 2022, with a 27.8% increase over the previous year. This trend suggests that more students are choosing Spain, and specifically cities like Valencia, as their study destination, further driving the need for student housing.
Moreover, real estate market reports highlight a shortage of student housing, particularly in cities like Madrid, which indicates a similar situation could be occurring in Valencia. The ongoing expansion of university programs and Spain's increasing popularity among international students are likely to sustain high levels of demand for student housing.
Sources: ICEF Monitor, Valencia College, The Class Foundation
14) Affordable housing prices in the city will rise gradually as demand for budget-friendly options increases
Valencia's affordable housing market is on the rise as more people look for budget-friendly homes.
In 2023, Valencia's real estate market bounced back, and this positive trend is expected to continue into 2025. This steady demand is keeping prices stable and making it a good time for investors to jump in.
With more people moving to Valencia, there's a growing need for housing, especially affordable options. While we don't have exact numbers on the shortage, the increasing demand and population growth hint at a lack of budget-friendly homes.
Rental demand is climbing, particularly near universities and trendy neighborhoods. This uptick in rental prices might push more people to buy affordable homes, boosting demand and potentially driving prices up.
For those considering buying property in Valencia, it's worth noting that the city's affordable housing sector is becoming more attractive as demand grows.
As more people look for budget-friendly options, the city's affordable housing sector will likely see a gradual price increase.
Sources: Cabanyal Estate, Population Association, World Population Review
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.