€11.000 a Square Metre: What Just Happened in the Southwest
Hiscox published its 2026 report on Spain's prime residential market this month, and one figure deserves more attention than it's getting: 34% of every property in Spain priced above €3.000.000 is in the Balearics. Málaga province, home of the entire Costa del Sol machine, holds 31%. Madrid trails at 14%.
For those of us who work this market daily, the direction wasn't news. The scale was.
The numbers
Three micro-markets in the Balearics have now passed €11.000 per square metre on average. Puerto Andratx leads at €11.928. Costa d'en Blanes sits at €11.081. Both are within twenty minutes of our office in Palma.
Zoom out and the picture holds. The Steinbeis Institute's 2026 study — the most rigorous independent read of the island's market, now in its twelfth year — puts the island-wide average at €7.370/m², up 9.8% year on year. The southwest as a region is approaching €10.000/m². And the product everyone actually wants remains almost impossible to find: properties with a genuine sea view and a pool account for roughly 2% of everything for sale on the island.
That last figure explains most of the others. Prices at the top of this market aren't being driven by cheap money or speculation. They're being driven by the fact that the coastline is finite, the planning rules are strict, and nobody is making more Costa d'en Blanes.
Why now
Hiscox points at something specific: the 2024 Balearic tax reform. Inheritance and gift tax between close family, effectively gone. The wealth tax exemption threshold, raised to €3.000.000 per taxpayer. For a German family weighing a house in Calvià against one on Lake Como, that reform changed the arithmetic overnight — and Germans now account for 46% of purchases in Calvià, 33% in Palma.
Worth adding, because buyers keep asking: the proposal to restrict property sales to foreign buyers was rejected by the Balearic Parliament this year. The market is open, and under EU law it will stay that way. If you've read alarming headlines, that's the actual position.
What it means if you own here
If you bought in Bendinat, Portals, Costa d'en Blanes or around Andratx before 2024, your sense of what the property is worth is probably out of date. Not slightly — the average price per square metre in the region has risen around 20% since 2020, and the reform accelerated the top end from 2024 onwards.
That doesn't automatically mean sell. It means know your number. Age is an asset in this market, not an apology; a well-built house from the nineties on a good plot in Costa d'en Blanes is precisely what the 2% shortage is made of.
What it means if you're buying
The honest version: waiting has been expensive for a decade and there's nothing in the data suggesting that changes. Supply at the quality end is shrinking as a share of the market, demand is tax-advantaged and international, and the properties worth owning rarely reach the portals before they sell. If your brief is sea view and pool in the southwest, you're competing for one in fifty listings.
We'd rather you bought the right house slowly than the wrong one fast. But "slowly" should mean careful, not passive.
If you'd like a current valuation of a property in the southwest or anywhere on the island, it's a conversation with property advisors, not a form and an algorithm. Write to us at [email protected] or call +34 685 685 195.
