The luxury housing market in Madrid is booming. Not so long ago, in 2019, it was likely to reach the maximum ceiling of demand and price growth, but since the pandemic period, the market not only did not stagnate, but began to grow with renewed vigor. Thousands of local and foreign buyers, especially from Latin America, have become the foundation for record growth rates in the last 3 years. All this has led to an incredible inflating of prices.
For example, luxury real estate, which was often sold for a maximum of 1.5 million a couple of years ago, has practically disappeared from the market today. Now luxury-class objects, for example, with an area of around 120 square meters, will cost buyers at least 2 million. A real luxury, properties with an area of 150 square meters, jumped in price even higher. And in the available market segments, there is absolutely the same situation.
The main demand for luxury housing in Spain today comes from wealthy foreign buyers. On the streets of Madrid like Salamanca, the prices for luxury real estate do not fall below two million. And even this is rare. Other popular elite areas of Madrid, such as Retiro, Recoletos and Justicia, have also long since passed the price mark of two million. To date, mostly only foreigners can afford to buy premium objects on the market without any problems.
They are interested in modern houses and apartments, usually from three bedrooms and more. With various amenities and luxuries, like a penthouse with terraces or a rooftop pool. The area of the apartments they are interested in usually starts from 150 square meters, the "real suite". This is a very scarce asset, since they account for only 3.5% of the real estate market in Madrid.
After the pandemic, the luxury real estate market began to develop actively again, channeling a significant part of the savings and liquidity of wealthy investors in conditions of historically low interest rates and the lack of safe and effective real estate alternatives. Spain, in particular Madrid, were able to ride the wave of popularity for such assets and become a key player in the housing market both in Europe and around the world. According to the consulting company Knight Frank, Spain is the fourth most popular luxury real estate market in the world, second only to Dubai, Miami and Dublin.