What is Really Happening with the Costa del Sol Real Estate Market and Estepona?

In recent years, the Costa del Sol real estate market has been marked by headlines focused on record prices, high international demand, and a shortage of supply. However, behind this seemingly uniform narrative, the current reality of the sector in Estepona and surrounding areas is much more complex.

Today, we can no longer speak of a single Costa del Sol real estate market. What is truly occurring is a progressive fragmentation between different types of properties, buyers, and demand segments[cite: 18]. Some homes generate quick viewings and transactions, while others remain for months on real estate portals without sparking real interest[cite: 16].

In areas such as Estepona, Marbella, or Benahavís, even within the same urbanization, properties that sell quickly can coexist with others that require continuous price reductions to gain attention. This demonstrates that the traditional question of whether “the market is going up or down” no longer correctly reflects the current state of the Costa del Sol real estate market.

Fragmentation of the Costa del Sol Real Estate Market

Applying a more analytical view, the current real estate market can be divided into multiple segments that are completely distinct from one another. There is new build and there is resale housing. There is the international buyer with high liquidity and the buyer who depends on mortgage financing. Wealth investors, second-home buyers, and families seeking a permanent residence also coexist.

Each of these profiles responds differently to the current economic context. New construction in the Costa del Sol real estate market continues to maintain strong international demand thanks to the scarcity of available land and the area’s international appeal. However, it is also beginning to face very high prices and much more demanding buyers.

On the other hand, much of the resale housing in Estepona is starting to show different symptoms: overexposure, poorly adjusted expectations, and long marketing periods. Many properties appear duplicated on various portals, published by different agencies with contradictory descriptions. This lack of commercial strategy ends up directly affecting the perceived value of the home.

Data Explaining Current Market Behavior

According to the latest data from the Notary Statistical Portal, the average housing price in Estepona reached €3,271/sqm, recording a positive annual variation of 10.9% within the context of the Costa del Sol real estate market. Furthermore, the average transaction value exceeded €419,000, and the average transmitted surface area was 128 sqm.

Nevertheless, behind these positive figures lies a more segmented reality in the Costa del Sol real estate market. More than 74% of sales currently correspond to second-hand homes, while new builds represent approximately a quarter of the market real of operations. This is particularly important because much of the current discourse regarding the Costa del Sol real estate market focuses almost exclusively on new developments, when the true volume of operations continues to occur in the resale market.

Another relevant fact for understanding the Costa del Sol real estate market is the international buyer profile. More than 70% of transactions carried out in Estepona currently correspond to foreign buyers, especially from the Netherlands, the United Kingdom, Sweden, Belgium, and Poland.

A More Selective and Less Impulsive Buyer

The average age of a buyer in Estepona is currently around 52 years old. This means that a large part of the demand in the Costa del Sol real estate market corresponds to financially solid profiles with analytical capacity and a smaller impulsive component than in previous cycles.

Demand still exists, but behavior has changed. Today’s buyer in the Costa del Sol real estate market compares more properties, negotiates more conditions, and studies each operation in more detail before making a decision. This causes not all properties to respond equally. In the current context of the Costa del Sol real estate market, well-positioned, correctly valued homes with a coherent commercial strategy continue to perform well.

The Importance of a Professional Real Estate Strategy

In Marina Homes, we observe daily how this fragmentation of the Costa del Sol real estate market directly influences real operations. The Costa del Sol continues to be one of the most attractive real estate destinations in Europe due to its climate and infrastructure[cite: 16]. However, the market is entering a stage where correctly interpreting each segment will be more important than mere visibility.

In the current context, it is no longer enough to just be “for sale.” The real key lies in understanding exactly which part of the Costa del Sol real estate market each property is in and how that specific segment truly behaves.