Lifestyle and profitability make Alicante a leader in foreign real estate investment

"The province of Alicante is the leading power in residential tourism in Spain.

Oliver Thansan
Oliver Thansan
03 April 2024 Wednesday 10:31
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Lifestyle and profitability make Alicante a leader in foreign real estate investment

"The province of Alicante is the leading power in residential tourism in Spain." This is stated by Jesualdo Ros, general secretary of the Association of Real Estate Developers of the Province of Alicante (Provia). It is based on data corresponding to 2023, according to which foreign real estate investment on the Costa Blanca reached 3.5 billion euros in 2023.

Ros alludes to "lifestyle" as one of the fundamental reasons that attract foreign investors, but this being an incontestable argument, he considers that Alicante's leadership is due to its combination with another compelling reason: the high profitability of the investment. And not only because of the revaluation of assets, but because tourist accommodation offers high profitability, higher than that of other areas with similar characteristics.

The lifestyle and profitability of real estate investment make Alicante "a very seductive cocktail", explains Ros, for investors who, "as is common for example in the Norwegian colony, spend in their residences on the Costa Blanca from October to May and rent the property in high season", thus obtaining high income.

Ros refers us to the report of the Costa Blanca Residential Tourism Observatory to dissect this growing market in more detail. Firstly, a certain relaxation compared to 2022 stands out, because in 2023 30,072 homes were sold in Alicante to foreigners, 5% less than in the previous year. However, that is no less than 251% more than at the beginning of the series studied, in 2010. And there are about 8,000 more than in the year before the pandemic.

The average amount was higher than 2022 and the highest in the series: 177,545 euros. Of the total, 26,448 were second-hand; 20,172 were apartments and 9,900 single-family residences. The British, despite the fact that in 2023 they bought 15% fewer properties than the previous year, continue to lead the ranking in number of acquisitions, but not in total turnover, where they have been surpassed by investors from the Netherlands.

Among those that increased their operations, the Ukrainians stand out, who after the Russian invasion have come in large numbers to the province of Alicante and have multiplied their purchases by four in previous years, reaching 1,400 operations in 2023, very close to the sixth largest country. active, which is France.

Ahead of the neighboring country, Poland is consolidated in fifth position, which since the pandemic has multiplied its air connections with Alicante (up to eight Polish cities have flights with the Miguel Hernández airport), and has surpassed other more traditional markets, such as Sweden, as a customer. and Norway and if it continues like this it will soon surpass Germany. In 2023, Poles only made 20 fewer purchases than the 2,179 made by Germans.

By turnover volume, the Netherlands, the United Kingdom and Belgium are - in that order - the only ones that exceed 700 million euros annually invested in properties on the Costa Blanca. Behind them, Germany, which barely exceeds 400 million after a decrease of 22% compared to 2022, and Poland, which is hot on its heels having increased its real estate investments in Alicante by close to 16%.

France, Sweden, Russia Ukraine, Norway and Ireland are the following clients, with disparate trends: while the Swedes invested 30% less, the Norwegians 18% and the French 16%, Russians (25%) and Ukrainians (47% ) greatly increased the capital allocated to the Alicante real estate sector.