Spain’s rental prices increased on average by 10%!

Raymundo Larraín Nesbitt, March, 1. 2023

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One more year, the increase of rental prices has pulverised all previous records! Rental prices have soared by two digits over the last year on average in large cities and coastal areas. This consolidates a long standing trend that goes all the way back to 2016. Granted, inflation has played a large role on this steep increase, but even so this sharp increase is truly impressive!

As we published back in February 2021 (8 Tips to rent like a pro (Buy-to-Let)), Buy-To-Let in Spain has proven a very successful investment for savvy investors. Scores of landlords make large amounts of rental income every tax quarter. You can realistically expect to rent out nine months a year in Spain as a holiday rental.

In addition, Spain’s taxation on rentals award huge tax breaks to EU-resident landlords. Landlords can expect tax breaks of 70%, or more, on (rental) income tax. We’ve published several taxation articles on the lenient tax relief landlords can apply for: Buy-to-let in Spain: landlord tax reliefs - 23rd May 2019

The rental money can be used to offset overheads and maintenance expenses, including servicing mortgage repayments. No other investment is giving a consistent 5% net yield/year safely! By comparison, bank deposits in Spain give 0%.

But that’s not all, it only gets better!

Besides soaring rental yields, you also need to factor in the property’s capital appreciation (the increase in value of real estate over time). Properties in Spain have seen their value increase over the previous five years at an average rate of 5% pa. In large cities, this has even surpassed two digits i.e. Madrid.

Pro-tip: When you combine both soaring rental yields and capital appreciation, you reach the conclusion that Spanish real estate is giving a safe two-digit return year-on-year.

In plain English, that's over a 10% yield every year safely! This is ideal for retirees who are afraid of sharp stock market fluctuations, roller coaster cryptocurrencies, and seek a safe and consistent return on their investment year on year to build up their pension pot.


At Larrain Nesbitt Abogados we have over 20 years’ experience buying, selling, and renting properties. We are also specialized in immigration & residency visas. You can contact us by e-mail at, by telephone on (+34) 952 19 22 88, or by completing our contact form to book an appointment.

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