Property prices in Spain’s islands and coastal areas are rising at rates above the national average, largely bolstered by second home buyers, while in the interior, they’re falling.

A monthly index released by property experts TINSA has revealed that property prices in Spain in May rose month-on-month by an average of 0.3% compared to April and are 4.8% more expensive year-on-year overall.

“The average national residential price continues its trend towards stabilisation in the face of rising financing costs and the loss of purchasing power in the face of inflation, although employment continues to sustain household solvency. As a result, sales activity is gradually moderating, maintaining levels above 2019,” Cristina Arias, director of research at Tinsa, told local media.

Coastal areas and islands have seen the highest increases, largely because they are the main beneficiaries of tourism that attract potential second-home buyers to the area, while in large cities and metropolitan areas, prices are generally moderating. Property prices grew by 1.4% in the Canary Islands and Balearic Islands and by 0.9% on the Mediterranean coast in the month of May.

However, according to Tinsa’s data, property is currently 4.8% more expensive than in May 2022, a slight decrease on year-on-year increases of more than 7% recorded throughout much of the second half of 2022.