The Iberian Peninsula: An oases of opportunity in Europe

As a foreigner living in Madrid, every month I go on a trip with my family to discover a new Spanish city.??

?On each of these trips, I’ve been able to see how Spain and also my home country, Portugal, have become tangible oases for real estate investment, thanks to the tailwinds driving an economic upturn across southern Europe.?

?On the one hand, despite global challenges such as inflation and energy costs, both countries are showing robust growth: interest rates have stabilised, unemployment is at historic lows and both Spain and Portugal’s economies are evolving towards greater productivity levels This creates an environment conducive to medium and long-term investment. ?

?Opportunities in both countries include not only more traditional real estate such as logistics, but also emerging sectors such as data centres, which are experiencing a real ‘boom’ thanks to lower operating costs and the quality of infrastructure in both markets.?

At the same time, both Spain and Portugal can boast an enviable quality of life. Their privileged climate, excellent gastronomy and competitive cost of living are a big attraction for tourists, digital nomads and international students whose presence sustains economic activity.?

?The retail sector’s one of the great beneficiaries of this. You only have to stroll through the streets of Madrid, Barcelona or Lisbon to see first-hand their resurgence, driven by the return of physical shopping. The same is true of shopping centres and retail parks which, quarter after quarter, are recording steady growth in sales and footfall. It’s an optimal time to invest in prime locations at prices that are still competitive compared to other European capitals.?

Meanwhile, the housing sectors of both countries are characterised by demand far outstripping supply. In Spain alone, around 193,000 new families were created in 2024, three times the number of new-build houses registered until September. This imbalance creates a very favourable scenario for forward-looking property developers, especially in large cities or on the coast, where a significant proportion of foreign population and demand is concentrated.?

?While we expect the global economy to continue to face challenges in the year ahead, the safe haven appeal of real estate assets remains strong. With favourable macroeconomic conditions in Spain and Portugal, we can expect 2025 to be the year in which both countries consolidate their position as attractive investment destinations in Europe.?