Costa del Sol Quarterly Review Q1 2026: What Insiders Are Saying

The first quarterly edition of Quarterly Review, a new podcast series hosted by Alfredo Bloy-Dawson tracking the Costa del Sol real estate market, brought together agents, lawyers, developers, and data specialists to take stock of the first three months of 2026. The picture that emerged was of a market that remains fundamentally strong but is adjusting to a more uncertain global environment.

On the Ground: A Steady Start, Not a Spectacular One

Sean Woolley, managing director of Cloud Nine Spain, opened with a nuanced read. In terms of deal volume, he said, Q1 was “second only to 2024, and only then by a very small margin.” But volume alone tells an incomplete story. Average sale values have dropped roughly 20% compared to the same period in recent years, pulling the average transaction down from around €1 million. “We’re slightly behind,” Woolley said, “but not by much.”

The month-by-month picture was mixed. January was slow, which surprised Woolley given that recent Januaries had broken the traditionally quiet pattern. Notary data later confirmed the trend: transaction volumes were down year-on-year across Spain provincially and locally. February recovered, and March offered cautious encouragement.

Peter Franke, co-founder of Franke & de la Fuente law firm, reported a similar arc from his firm’s perspective. Lawyers see deal flow from multiple agencies simultaneously, giving them a broader view than any single agency. His reading: January and February were slow, but by March “the momentum is coming back.” He also pointed to the most straightforward explanation for the quiet start – the weather. January brought unusual levels of rainfall to the Costa del Sol, and buyers simply postponed their viewing trips. “People tend to buy properties here because of the lifestyle,” Franke said. “But it’s mainly the weather. When we have this unusual rainfall, buyers choose to push their trips forward.” Cloud Nine itself had advised clients to cancel viewings – counterintuitive for salespeople, but pointless in the rain.

The Numbers from Above: What Kyero Saw

For a data-driven perspective, Alfredo turned to Eugenio Oliden, commercial director at property portal Kyero. Comparing Q1 2026 with Q4 2025, Oliden reported US traffic to Costa del Sol listings up 53%, Ukraine traffic up 47%, and UAE traffic up 35%. Year-on-year, Q1 2026 versus Q1 2025, the US figure was more striking still: a 110% increase in searches from American users.

Oliden also noted a growing interest in plots of land, with searches up 23%, though these still represent only 6-7% of total activity on the platform. WhatsApp is also gaining ground as a communication channel between buyers and agents, rising 23% quarter-on-quarter, a shift worth noting for any agency still relying primarily on enquiry forms and phone calls.

The Dutch, Belgian, Polish, and Finnish Markets

Marleen De Vijt, owner of Azull Properties and a specialist in Dutch and Belgian buyers, described a first quarter that mirrored 2025 – slow in January and February, then stronger in March. She noted that lead costs have doubled. “We’re paying double now to get a lead in,” she said, attributing the increase partly to uncertainty around the Middle East conflict. “That doesn’t mean there is no money anymore in the world, but people do not want to spend it.” On the outlook, she was direct: “Smart buyers buy when other buyers stay at home.”

Agnès Kostrzewa of Agnès Inversiones reported a relatively quiet first quarter for the Polish market, though recent weeks had brought a pickup in activity. She also observed a shift in what Polish clients are asking about – growing interest in commercial properties and hotels, rather than purely residential purchases. She added that Polish investors who had been active in Dubai are now making enquiries about the Costa del Sol.

The Finnish market was the most positive of the episode. Anne Ramsay, founder of Atelier Ramsay, described Q1 as “very busy, with a lot of active Finnish buyers,” and said that investor interest – in plots, renovation projects, and new builds – has been rising. She predicted that June may bring a seasonal slowdown as Finnish buyers return home for the summer.

The Dubai Question

The Middle East conflict, and specifically its effect on Dubai, ran as a theme throughout the episode. Alfredo put the question directly: would disruption in the Gulf bring additional buyers to Marbella?

Jimmy Widén, who owns 3SA Estate in both Marbella and Dubai, gave a considered answer. Dubai, he said, has effectively gone quiet – from 260,000 arrivals a day to near zero, with the property market following suit. He was clear, however, that the two cities are not comparable: one is a major global city, the other a small coastal town, and the difference in tax regimes is decisive. “I don’t think that anyone of these people will rent here and then consider moving here permanently because of the taxes – that is a huge difference between Marbella and Dubai.”

What Widén does expect is a significant influx of Dubai residents renting in Marbella over the summer, with a boost to restaurants, traffic, and local commerce. He also predicted that Dubai’s own market would recover faster than many expect – from around September or October.

Erik Finnäs Dahlström, CEO of luxury international portal JamesEdition, offered a more granular perspective. In Dubai, he observed that off-plan transactions are holding up better than secondary market sales, which he read as a signal that long-term confidence in Dubai remains intact even if short-term activity has stalled. On Marbella, he noted that demand indicators on the site had been picking up before the Middle East situation escalated, suggesting the two markets are less directly linked than some assume. He was, however, clear about the longer-term possibility: if the conflict continues, rental demand from Dubai residents in Marbella could gradually convert into purchase demand, and given the scale of Dubai’s market relative to Marbella’s, even a modest spillover would be a meaningful demand driver.

Alfredo added a note of caution: several deals at Cloud Nine had been lost from clients who hold assets in the region and are too nervous to commit elsewhere while those assets are tied up. “It’s not as rosy as you might think,” he said. “It depends on the client and how exposed they already are to the Middle East.”

The Developer’s View: Building Licence Delays and Rising Costs

Marc Pritchard, sales and marketing director at Taylor Wimpey España, described Q1 as “slightly more challenging than anticipated,” primarily because a number of new sites expected to launch in early 2026 have been delayed – some by three months, some by six, and some still awaiting licences. Fewer sales outlets means fewer sales, straightforwardly.

On buyer nationalities, Pritchard confirmed that British and Dutch buyers remain the main markets on the Costa del Sol, with Spanish second-home buyers now the strongest single market for Taylor Wimpey in terms of both visits and reservations year-to-date. Q2, he said, is always the most important quarter of the year, and the priority is getting delayed projects online in time for the April-to-mid-June sales window.

Woolley connected this to a broader pattern: some developers, for the first time in several years, are increasing agent commissions and offering incentives they would not previously have considered. “They don’t have to do something, they don’t do it,” he said. “It’s a sign.” He noted a partial parallel with the Covid period, when developers offered subject-to-viewing reservations to maintain engagement. It is not a sign of distress, he said, but it does indicate a market adapting to moderating conditions.

Legal Updates: What Has and Hasn’t Changed

Peter Franke addressed three regulatory developments that have been generating discussion in the sector.

On VAT exemption for self-employed agents earning under €85,000 annually: this is an EU directive that permits member states to adopt the measure, but Spain has not yet done so. “There are no announcements whatsoever that it’s going to be done,” Peter t said. The practical point – do not treat this as current policy.

On the much-discussed 100% tax on non-EU property purchases, floated by the Spanish government as a proposal last year: no progress to report.

More immediately relevant is a change to transfer tax rules for property investors using Spanish SL companies. Previously, companies that bought, renovated, and resold a property within five years could qualify for a reduced 2% transfer tax rather than the standard 7%. Two things have now changed: the reduced rate only applies to properties priced at €500,000 or below, and the resale window has been shortened from five years to two. “Those two points are important to keep in mind for anyone watching,” Peter said.

The final legal point concerned the solidarity tax. The 60% cap on taxable wealth that had applied to Spanish residents but not to non-residents has now been extended to non-residents following a court ruling that the previous differential was discriminatory. It is not new legislation, Peter noted, but a judicial reinterpretation that levels the treatment of residents and non-residents.

The Agent Registration Story Takes a New Turn

The most significant piece of news in the episode concerned compulsory agent registration in Andalucía.

In January, a regional law came into force giving the Junta de Andalucía two years to implement a mandatory registration system for real estate agents. The sector had broadly welcomed this as a step towards professionalising the market. Then came the complication, one that Álvaro Botella, president of the LPA agents’ association, had flagged in advance and which Alfredo acknowledged publicly on air.

The central government in Madrid has challenged the mandatory nature of the scheme as unconstitutional, echoing a similar challenge that derailed equivalent legislation in the Balearic Islands. As matters stand, the registration system will not be compulsory.

“If you remove the obligatory nature of it, it becomes a badge – a voluntary thing, which doesn’t regulate the market,” Alfredo said. “Which means the cowboys can still be cowboys.”

Botella confirmed that agents’ associations across Andalucía are forming a new regional federation – the signing is scheduled for 11 May – with the aim of presenting a united front to the Junta and lobbying to preserve as much of the original framework as possible.

Franket pointed to professional associations in markets such as the UK, which have built reputational standards without legal compulsion. Woolley acknowledged the point but raised the practical challenge: most international buyers arriving in Marbella have no idea that organisations like the LPA or GIPE exist, let alone that they function as a quality marker. Until that changes, the protection these bodies offer is largely unknown to the people who would benefit from it. How associations communicate their value to buyers – not just to members – remains an open question.

Outlook for Q2

Both studio guests were cautiously optimistic for the second quarter.

Woolley predicted Q2 would be stronger than Q1, in line with historical seasonality, and cited a healthy pipeline of leads from around the world. “The sun is shining now, which also makes a difference,” he said. “It puts people in a better frame of mind for making buying decisions.”

Franket was equally positive. “The fundamentals are all in place. They haven’t changed. It’s external factors that are influencing, but the fundamentals are absolutely there.” His prediction, in a word: strong.

A Final Note on ChatGPT

As a closing point, Alfredo typed the same question the panel had spent an hour discussing into ChatGPT. The response – price growth of 10-13% in prime areas, average values exceeding €5,400 per square metre in the Golden Triangle, demand led by British and American buyers, modest moderation expected through the rest of 2026 – was accurate but entirely general.

“That would have saved us a lot of work,” Alfredo said.

It would not, however, have covered the Euribor rising 60 basis points in six weeks, building cost inflation forcing villa projects off the market, or Polish investors in Dubai beginning to look at the Costa del Sol. That is the value of speaking to people in the market.

Quarterly Review is available on YouTube and Spotify. The next edition will cover Q2 2026.