Spain offers one of the most attractive real estate markets in Europe for international investors. With high rental demand, relatively affordable property prices, and a diverse range of cities catering to different strategies, Spain remains a prime destination for buy-to-let investment.
But not all cities offer the same returns, legal flexibility, or growth potential. In this guide, we’ll explore the best cities in Spain to invest in buy-to-let property in 2024, based on rental demand, pricing trends, licensing regulations, and projected yields.
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1. What Makes a Spanish City Ideal for Buy-to-Let Investment?
Before diving into the rankings, it’s important to understand the key criteria that determine whether a city is a smart buy-to-let destination:
- Strong and consistent rental demand
- Legal viability for your rental model (short-, mid- or long-term)
- Competitive property prices and healthy gross/net rental yields
- Local infrastructure, job creation, tourism, or university activity
- Population growth and urban development plans
- Ease of property management and service availability
With these criteria in mind, let’s examine the most promising cities for buy-to-let investment in 2024.
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2. Valencia: A Rising Star for Mid-Term and Long-Term Investors
Valencia has become one of Spain’s most popular cities for both locals and expats—and one of the best-performing rental markets.
- Average Property Price (2024): €2,200–€3,300/m²
- Gross Rental Yield: 6%–8%
- Popular Rental Models: Mid-term rentals (digital nomads, students), long-term leases
- Legal Landscape: Short-term rentals restricted in some districts; mid-term fully viable
Why it’s attractive:
- High demand from international workers, students, and relocating families
- Well-connected by public transport, train, and air
- Affordable compared to Madrid and Barcelona
- Established infrastructure, active lifestyle, and growing tech sector
Valencia is ideal for investors seeking solid yields, legal clarity for mid-term rentals, and appreciation potential.
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3. Madrid: High-Value Market for Stable, Long-Term Income
As Spain’s capital, Madrid is a safe, steady option for investors focused on capital preservation and stable long-term returns.
- Average Property Price (2024): €4,200–€5,500/m²
- Gross Rental Yield: 4.5%–5.5%
- Popular Rental Models: Long-term executive rentals, student housing
- Legal Landscape: Strict rules for short-term rentals; mid- and long-term fully legal
Why it’s attractive:
- Spain’s business and political hub
- Consistent demand from professionals, diplomats, and multinational employees
- Strong local economy and job creation
- International schools and universities boost rental market
Madrid is less about yield maximization and more about stability, consistent returns, and long-term capital appreciation.
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4. Malaga: Ideal for Hybrid Investors Combining Mid-Term and Tourism
Malaga has become a favorite among lifestyle investors, combining coastal living with strong rental demand from both tourists and long-term tenants.
- Average Property Price (2024): €2,800–€4,200/m²
- Gross Rental Yield: 6%–8%
- Popular Rental Models: Short-term (licensed), mid-term for remote workers
- Legal Landscape: Tourist rentals permitted with license; mid- and long-term viable
Why it’s attractive:
- Growing expat population and international companies
- Strong tourism sector with year-round demand
- Digital Nomad Visa increasing mid-term rental demand
- Direct international airport with strong connectivity
Investors seeking both personal use and cash flow potential find Malaga a highly flexible and profitable location.
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5. Seville: A Top Choice for Long-Term and Student Rentals
Seville combines cultural heritage with economic activity and a large student population.
- Average Property Price (2024): €2,200–€3,200/m²
- Gross Rental Yield: 5%–6.5%
- Popular Rental Models: Long-term, student housing, mid-term rentals
- Legal Landscape: Less restrictive than tourist-heavy cities
Why it’s attractive:
- Major university city with consistent tenant demand
- Low property prices relative to income
- Growing service and tech sectors
- Local initiatives to promote sustainable urban development
While not as fast-appreciating as Valencia or Malaga, Seville offers predictable income and affordable entry.
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6. Alicante: High Yield Potential with Affordable Entry
Alicante is gaining attention for its combination of low prices and high rental yields, especially for mid-term rentals.
- Average Property Price (2024): €1,800–€2,800/m²
- Gross Rental Yield: 6%–8%
- Popular Rental Models: Mid-term and seasonal rentals
- Legal Landscape: Generally friendly to tourist rentals (check district-by-district)
Why it’s attractive:
- Appealing to retirees, digital nomads, and part-time residents
- Coastal lifestyle with lower costs than Malaga or Barcelona
- Active international community and stable year-round climate
- Close to regional airports with strong European connections
Alicante is ideal for budget-conscious investors seeking strong yields and lifestyle value.
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7. Barcelona: Still Attractive, But Highly Regulated
Barcelona remains one of the most desirable cities in Spain, but heavy tourist regulation and high prices reduce its suitability for some buy-to-let models.
- Average Property Price (2024): €4,500–€6,200/m²
- Gross Rental Yield: 3.5%–5%
- Popular Rental Models: Mid-term rentals, long-term executive lets
- Legal Landscape: Tourist rentals are highly restricted or banned in many districts
Why it’s attractive:
- Global brand and consistent demand
- Large expat population
- Infrastructure, universities, and international companies
- High liquidity and resale potential
Investors willing to navigate the legal landscape and focus on mid/long-term strategies can still find success—but Barcelona is no longer a tourist rental playground.
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8. Honorable Mentions: Other Cities to Watch
- Zaragoza: Low prices, growing population, solid long-term demand
- Bilbao: Cultural center with mid-term and student rental potential
- Granada: Strong demand for student housing and cultural tourism
- Palma de Mallorca: High-yield in tourism, but heavy license restrictions
- Murcia: Affordable, developing, with long-term rental opportunities
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9. Key Takeaways: Choosing the Right City for Your Strategy
| Investment Goal | Best City Candidates |
|---|---|
| High Yield & Affordable Entry | Alicante, Valencia, Seville |
| Legal Flexibility (Mid-Term) | Valencia, Malaga, Seville |
| Capital Appreciation + Income | Madrid, Valencia, Malaga |
| Student Rental Market | Seville, Granada, Valencia |
| Hybrid Lifestyle + Rental Income | Malaga, Alicante |
| Stability and Long-Term Holding | Madrid, Bilbao |
Your strategy—short-, mid-, or long-term—should align with your target location’s legal landscape, tenant demand, and infrastructure.
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✅ Need Help Choosing the Right City for Your Investment Goals?
In our Investment Strategy Session, we help you:
- Compare cities based on your goals and budget
- Evaluate short-, mid-, and long-term rental models per location
- Understand licensing laws, yield potential, and demand forecasts
- Build a city-by-city action plan tailored to your investor profile
💶 Price: €500
📅 Duration: 60 minutes
🎯 Outcome: Clarity on where and how to invest for optimal returns
👉 Book your Investment Strategy Session here
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Conclusion
Spain is not a one-size-fits-all market. The “best” city to invest in depends on your specific strategy, your risk appetite, and your capacity for legal and operational management.
In 2024, cities like Valencia, Malaga, and Alicante offer the best blend of profitability, legal feasibility, and tenant demand—but success ultimately comes from aligning the location with your long-term vision.