2025: A roll of the dice for global luxury real estate markets

This year has been shaped by fluctuating economic conditions, geopolitical tensions, evolving regulations and technological advancements. This dynamic and unpredictable landscape has driven buyer sentiment and reshaped investment strategies across the globe.?

Marbella has solidified its position as southern Europe’s leading all-year-round destination. Our local real estate market continues to thrive, thanks to our unique combination of climate, exclusivity, lifestyle, and strategic location, offering an attractive proposition for affluent demographics seeking both high-quality living and secure, long-term capital appreciation.

2025 promises to keep our industry on its toes, with heightened competition, increasingly price-sensitive and sophisticated buyers, the ongoing challenge of managing sellers’ expectations,?and the growing need to embrace innovative technologies to stay ahead of the curve.

Key takeaways:

??Steady high-end market growth: Transactions increased, with an estimated 12% price appreciation compared to 2023.

??Price sensitivity: Post-COVID caution persists, with buyers carefully evaluating market conditions to identify the best opportunities.

??Valuations: Well-priced properties in prime locations sell swiftly, underscoring the importance of accurate pricing.

??Stagnant inventory: Listings that remain on the market for more than 6 months tend to be 20-30% above market value.

??The return of stealth wealth: A growing preference for discreet, understated lifestyles.

??Off-Market sales & listings: High-net-worth individuals increasingly favouring private transactions to ensure confidentiality and exclusivity.

??Consolidation of the super-prime segment: A notable rise in inventory and sales within the €15M to €30M price range.

?? Musts: Buyers are seeking to acquire properties within secured, gated communities with ample indoor car storage.

?? Refurbishments: Record-breaking prices per square meter have been achieved for upgraded units in communities over 20 years old.

??Buy land, they’re not making it anymore: Land scarcity driving funds and private investors to acquire plots in prime and upcoming areas.

??Middle eastern investments: Acquisition of LA ZAGALETA by Modon , Mabel Marbella JV with Bloom Holding & LEAD – Real Estate Developer , DarGlobal projects Terra Viva & Marea, Public Investment Fund (PIF) LIV Golf partnership with Real Club Valderrama and the rumoured Saudi takeover of Sotogrande.

??Wealth migration: A result of increasing pressure on taxation in key feeder markets for Marbella = UK.

??Rising construction costs: Developers must navigate escalating expenses while maintaining competitive pricing and high-quality standards.

??Contemporary vs. Traditional: The resurgence of Andalusian architecture amidst modern trends.

??New developments: A surge in projects within secure, gated communities offering state-of-the-art amenities, setting new benchmarks for luxury living.

??Branded residences: Top-tier names are entering the market, but it’s essential to assess whether the brand’s value and purpose align with buyer expectations and justify premium pricing.

??Agents: Buyers and sellers are prioritising the expertise of established local professionals to navigate the complexity of the market with confidence.

??Regulatory framework: Increased efforts by local stakeholders to promote transparency, professionalism, and consumer protection.

??Sotogrande on the rise: a flourishing high end segment with steady demand.

At Spain Sotheby's International Realty we are eager to embark on an exciting new chapter as we prepare for the upcoming launch of our operations in Marbella with a new flagship store on the renowned Golden Mile, supported by an experienced, multicultural team of hand picked advisors.

Under new ownership, we are bringing together key wealth corridors, including Dubai, the UK, Saudi Arabia, and now Spain. Our aim is to leverage the heritage and prestige of the Sotheby's brand to deliver unparalleled service to our clients through our global network, offering them access to the best opportunities across the globe.

We look forward to sharing more details very soon.

Wishing everyone a joyful festive season with their loved ones.

Ugo