July ends with two figures that define this market: the Euribor reaches its highest level since 2024, and Spain's notaries confirm that fewer homes are selling — at higher prices. The reason is not weak demand, but a shortage of quality product. Here is the picture for anyone buying, selling or investing in prime residential.
The Euribor closes July at 2.85%, its highest since 2024
The twelve-month Euribor closed July with a monthly average of 2.85%, almost three tenths above June's 2.58% and its highest reading since September 2024 (sources: Rankia, merca2, Moncloa). For an average variable-rate mortgage, the rise translates into an estimated increase of around €740 a year at revision. Behind it sits the ECB's 23 July meeting, which held rates steady but left the door open to a hike in September: analysts assign a high probability to the deposit facility rising to 2.50% on the 10th. For buyers using financing, the message from previous weeks is reinforced rather than changed: it pays to lock in mortgage terms now, without waiting for the autumn.
Fewer sales, higher prices: scarcity rules
Statistics from Spain's General Council of Notaries, published on 30 July, confirm the market's central paradox: in May, transactions fell 11.8% year on year — 55,761 sales, with declines in fourteen regions — while the average price rose 8.8% to €2,049 per square metre; for apartments, the increase reaches 14% (sources: Notariado/CIEN, Forbes, Infobae). The reading is clear: demand is not falling — supply is. BBVA Research maintains its forecast — an estimate, set out in its June report — that Spanish house prices will rise by around 12% in 2026. In the prime segment, scarcity is even more pronounced: the best product sells quickly and, frequently, never reaches the portals. For owners of quality homes, conditions remain favourable; for buyers, access is once again the decisive factor.
Regulation for international buyers: no changes
The announced tax of up to 100% on home purchases by non-EU non-residents has still not begun its passage through Congress and is not in force. [Context] In January 2026, the Spanish government asked Brussels for permission to restrict purchases of non-primary residences in the Canary Islands; the measure remains under review, and legal experts point to its difficult fit with EU law. For anyone buying in Madrid from abroad, the legal and tax framework remains, as of today, unchanged. We follow this closely and will keep our clients informed of any real developments.
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