Spain’s Rental Market Under Pressure as Prices Climb to Record Highs

Spain’s rental market continues to tighten, with average prices reaching historic highs and intensifying pressure on tenants across the country. As of May 2025, national rental prices surged 9.9% year-over-year, bringing the average to €14.50 per square metre—the highest ever recorded. This spike is largely attributed to a growing imbalance between supply and demand, exacerbated by a 36% drop in rental housing stock since early 2024 and a 26% increase in tenant demand. The numbers, released by real estate platform Idealista and reported by La Razon, reflect a housing market increasingly out of reach for many.

Experts warn that government attempts to regulate the sector may have inadvertently worsened the issue. Property analyst Antonio Ruiz argues that rent caps and other interventions can discourage landlords from listing their properties, effectively reducing supply and pushing prices even higher. This sentiment is echoed by economist María Fernández, who advocates for policies that support landlords and expand available housing through incentives and relaxed construction regulations.

Cities like Barcelona (€23.90/m²), Madrid (€21.70/m²), and San Sebastián (€18.50/m²) remain the most expensive places to rent in Spain. However, smaller cities have seen the steepest year-over-year rental hikes. Zamora leads with a 15.2% increase, followed by Ávila (14.9%), Castellón de la Plana (14.6%), and Santa Cruz de Tenerife (14.3%). While the vast majority of cities posted gains, a few exceptions like Girona (-2%) and Cuenca (-1.8%) recorded slight rent declines.

With rising migration to urban centres and a growing number of people priced out of homeownership, demand for rentals is expected to remain high. This situation places landlords in a strong position to increase rents but also underscores the urgent need for comprehensive housing policy reform. The long-term health of Spain’s rental market will likely depend on a balance between protecting tenants and incentivizing landlords to keep properties in circulation.
https://www.larazon.es/economia/precio-alquiler-sube-10-ano-piso-mas-caro-espana-barcelona_202406036654fc0b74cd7400016bb857.html