Credit: GRI InstituteSpain’s Living Assets Market: Key Insights from España GRI 2025 Report
Navigating affordability, regulation, and operational challenges in the Spanish residential real estate sector
June 25, 2025Real Estate
Written by Jorge Aguinaga
Spain’s real estate market is at a critical juncture, grappling with a persistent housing deficit, rising construction costs, and shifting regulatory frameworks. The GRI Institute’s Spain Living Assets Outlook H2 2025 provides an in-depth look at how industry leaders are navigating these challenges and identifying key opportunities in the country's residential sector.
Despite a significant housing supply gap in cities like Madrid and Barcelona, the question remains: Can demand be met at market prices? Rising construction costs and regulatory hurdles threaten the viability of many projects. However, creative financing models and public-private partnerships are seen as key solutions.
Build-to-Rent (BTR)
Investor confidence in BTR remains strong, fuelled by urbanisation trends and demand for flexible rental options. Yet, challenges such as high construction costs and financing constraints continue to test the sector’s scalability. Quality, operational efficiency, and ESG alignment are now crucial differentiators.
Flex Living
Co-living and long-stay hybrid formats are gaining traction due to rising housing costs and tenant demand for flexibility. However, operational complexity and regulatory grey areas remain challenges. Investors are increasingly focused on integrated development models with full control over the tenant experience.
Student Housing
The undersupply of purpose-built student accommodation (PBSA) continues to drive investment interest, especially with growing international student numbers. However, construction delays and operational inefficiencies are key barriers, requiring strong local partnerships and operational expertise.
(GRI Institute)
Senior Living
Spain’s ageing population is pushing senior living to the forefront of institutional investment. But the sector still faces challenges in terms of scale, development risk, and operational complexity. Consolidation and hybrid care models are seen as ways to unlock the sector’s full potential.
The Path Forward
While Spain’s residential market presents both challenges and opportunities, the key to success lies in innovation, collaboration, and execution. Industry leaders agree that a strategic blend of creativity, local insight, and operational excellence will be required to meet the demand for housing and create long-term value.
For a detailed exploration of the trends shaping Spain’s real estate market and the strategies driving growth, access the full Spain Living Assets Outlook report:
Spain’s real estate market is at a critical juncture, grappling with a persistent housing deficit, rising construction costs, and shifting regulatory frameworks. The GRI Institute’s Spain Living Assets Outlook H2 2025 provides an in-depth look at how industry leaders are navigating these challenges and identifying key opportunities in the country's residential sector.
Key Takeaways
Residential for SaleDespite a significant housing supply gap in cities like Madrid and Barcelona, the question remains: Can demand be met at market prices? Rising construction costs and regulatory hurdles threaten the viability of many projects. However, creative financing models and public-private partnerships are seen as key solutions.
(GRI Institute)
Build-to-Rent (BTR)
Investor confidence in BTR remains strong, fuelled by urbanisation trends and demand for flexible rental options. Yet, challenges such as high construction costs and financing constraints continue to test the sector’s scalability. Quality, operational efficiency, and ESG alignment are now crucial differentiators.
Flex Living
Co-living and long-stay hybrid formats are gaining traction due to rising housing costs and tenant demand for flexibility. However, operational complexity and regulatory grey areas remain challenges. Investors are increasingly focused on integrated development models with full control over the tenant experience.
Student Housing
The undersupply of purpose-built student accommodation (PBSA) continues to drive investment interest, especially with growing international student numbers. However, construction delays and operational inefficiencies are key barriers, requiring strong local partnerships and operational expertise.
(GRI Institute)Senior Living
Spain’s ageing population is pushing senior living to the forefront of institutional investment. But the sector still faces challenges in terms of scale, development risk, and operational complexity. Consolidation and hybrid care models are seen as ways to unlock the sector’s full potential.
The Path Forward
While Spain’s residential market presents both challenges and opportunities, the key to success lies in innovation, collaboration, and execution. Industry leaders agree that a strategic blend of creativity, local insight, and operational excellence will be required to meet the demand for housing and create long-term value.
For a detailed exploration of the trends shaping Spain’s real estate market and the strategies driving growth, access the full Spain Living Assets Outlook report: