Housing in Spain

Spain is mid-crisis on housing affordability — rents hit record highs through 2026, and a proposed tax targeting non-EU buyers is still just a proposal, not law.

A market under real strain

Spain’s rental market has been on a multi-year upward run: idealista’s index showed rents up 7.1% year-on-year in Q1 2026 and hitting fresh historic highs through mid-2026, with national growth still running around 4.2% annually by June. The crunch is sharpest in the big cities and coastal hotspots, driven by tight supply, strong internal migration to Madrid and Barcelona, and short-term tourist-rental competition for housing stock. This is the same pressure that drove the government to end the real-estate Golden Visa in 2025.

Rent by city

As of mid-2026, idealista put average asking rents at €23.7/m² in Madrid and €23.0/m² in Barcelona — the two most expensive rental markets in the country — against a national average of roughly €15.3/m². For a typical 70m² two-bedroom apartment, that translates to roughly the figures below; smaller inland cities remain dramatically cheaper.

The non-EU buyer tax proposal — still just a proposal

In January 2025, PM Pedro Sánchez floated a headline-grabbing measure: a 100% transfer tax surcharge on property purchases by non-EU, non-resident buyers, aimed at reducing speculative foreign demand pushing up prices. As of 2026, this remains a political proposal that has not been enacted into law — it has not passed Spain’s parliament in that form, and standard transfer tax rates (typically 6-10% of purchase price, varying by region, for a resale property) still apply to all buyers regardless of nationality. Plenty of alarmist content treats the 100% tax as current law; it is not, as of this writing, though it remains a live political debate worth monitoring if you’re a non-EU buyer (not renter) considering a purchase.

Deposits and the fianza system

Standard residential leases require a security deposit (fianza) legally capped at one month’s rent for standard housing leases, though landlords commonly also request an additional 1-2 months as a supplementary guarantee (bank guarantee or extra deposit) — especially from foreign tenants without a Spanish credit history or guarantor. Landlords are legally required to register the fianza with their region’s housing authority (e.g., the IVIMA in Madrid); if yours doesn’t, insist on a receipt, since an unregistered deposit is far harder to reclaim in a dispute at move-out. Many regions have also introduced (or debated) rent-control style "tensioned market area" designations that cap rent increases on new contracts in high-demand zones — Catalonia has been the most active in applying these, though enforcement and legal challenges are ongoing.

Utilities

Setting up electricity (with Endesa, Iberdrola, or Naturgy, among others), water, and gas requires your NIE, lease contract, and sometimes empadronamiento. Combined utilities for a typical 2-bedroom flat run roughly €120–€200/month, with electricity noticeably more expensive in summer (air conditioning) and winter (heating) than in the shoulder seasons. Internet/fiber contracts are widely available and cheap by Western European standards, commonly €30-€40/month for high-speed fiber.