Property prices in Alicante province have surged by an average of 12.9% during the first three months of 2026, according to real estate appraisal firm Gesvalt Tasaciones. The dramatic increase puts additional pressure on foreign buyer budgets as prices continue to outpace income growth across most European markets.
6 May 2026
Foreign buyers targeting Spain's Costa Blanca are facing significantly higher property costs in 2026, with official appraisal data confirming double-digit price increases across Alicante province during the first quarter. The 12.9% year-on-year rise reported by Gesvalt Tasaciones represents one of the strongest periods of price growth in the region in nearly two decades, directly impacting affordability for international purchasers whose incomes have not kept pace with Spanish property inflation.
House prices rose by an average of 12.9% in Alicante province during the first quarter of 2026, according to real estate appraisal company Gesvalt Tasaciones. The average price in the Valencian Community stands at €1,648 per square metre with a year-on-year hike of 14.6%. Despite the steep increases, the Valencian region average prices are lower than the national median of €2,012 per square metre.
The impact on actual purchase costs is substantial. A typical 90 square metre home in the region would cost €148,320, working out at almost €19,000 more than 12 months ago. This means a foreign buyer who was house-hunting in early 2025 would need to find nearly €19,000 additional funds to purchase the same property type today.
Split by provinces, Alicante leads with €1,863 per square metre, but with the smallest percentage rise of 12.9%. Valencia province has the highest increase at €1,677 per square metre, up 20.4%, and Castellón at €1,272 per square metre, up 13.3%. This divergence shows that while Alicante commands higher absolute prices, Valencia province is experiencing the fastest rate of appreciation in the broader region.
For foreign buyers focused on the Costa Blanca specifically, there's a meaningful tax development on the horizon: the Valencian Community is reducing the property transfer tax (ITP) from 10% to 9% from June 2026 for properties under €1 million. On a typical €200,000 purchase, that single point shaves €2,000 off closing costs — partial compensation for the price increases. Use our free Cost Calculator to see exactly what a specific Costa Blanca property will cost you in 2026, including all taxes and fees personalised to your nationality.
Separate data from property appraisal company Tinsa paints an even more dramatic picture for popular tourist destinations. House prices soared by 18.3% in Alicante province in the first three months of 2026 compared to a year earlier. Figures from property appraisal company Tinsa said the average price stands at €1,877 per square metre but numbers are even higher in popular tourist areas.
In Benidorm, the region's tourism capital, prices have reached particularly elevated levels. Benidorm reached €2,786 per square metre—a hike of 20.5% over 12 months and up by 2.7% on the previous quarter. Other big rises include Orihuela, where the average price is €1,986 per square metre (up 15.4% over a year); Alicante City on €1,980 per square metre (up 16.1%) and Torrevieja with €1,859 per square metre (up 15%).
The variation between the two appraisal companies' figures likely reflects different methodologies and property samples, but both datasets confirm the same trend: Costa Blanca property prices are rising at their fastest rate in nearly two decades.
Foreign buyers represent a significant portion of the Costa Blanca market. Over 43 per cent of homes sold were bought by foreign nationals in 2025 in Alicante province, making it one of Spain's most international housing markets. With foreign buyers now representing 45% of the market, the region has truly become a global destination for property investment.
The affordability challenge is clear: while Costa Blanca property prices rose 12.9% to 20.5% depending on location, wages in most European source markets grew at far slower rates—typically between 2% and 5% annually. This growing gap means that the purchasing power of foreign buyers is being eroded month by month.
Currency fluctuations add another layer of complexity for non-euro buyers, particularly British purchasers who remain the leading nationality among foreign buyers. Sterling's volatility against the euro can compound or cushion price rises depending on exchange rate movements.
The tax burden also weighs more heavily at higher price points. Property transfer tax (ITP) applies to resale properties at 10% in the Valencian Community today, dropping to 9% from June 2026 for properties under €1 million. On every €19,000 of price increase, that's an extra €1,710 to €1,900 in tax — and that's just one line of the true cost of buying, which typically adds 11-13% on top of the purchase price once notary fees, registry fees, and other hidden costs are included.
Multiple structural factors are fueling Costa Blanca's price growth. All major reports—BBVA, REBS, Bankinter—highlight the same issue: too little new housing is being built. BBVA expects a rise in building permits in 2025 and 2026, but stresses that even with +16% and +13% increases, this remains insufficient to meet demand.
Spain reached a tourism record in 2024 with more than 85 million visitors, many of whom stay along the costas. This tourism strength translates into rental income potential, which in turn drives investor demand for coastal properties.
Construction costs are also pushing up prices for new developments. The price of all these processes continues to rise, according to the National Institute of Statistics: Price increases in cement, steel, and other materials make construction more expensive.
The market is also being characterized as supply-constrained rather than speculative. Several sources—including BBVA Research and Bankinter—describe the market as "overheated" due to severe supply shortages, but not a speculative bubble like in 2007.
Price forecasts for the remainder of 2026 suggest continued growth, albeit potentially at a slower pace. Across Costa Blanca, average residential property prices are forecast to rise by approximately 4% to 7%, with premium coastal areas and high-demand towns potentially exceeding this range. Given strong international demand, limited supply, and excellent accessibility, a price increase of 5–8% in 2026 is a realistic scenario.
Buyers should act with realistic expectations rather than hoping for price corrections. Prices are not expected to drop significantly. Major analysts project continued growth, not declines, making a "wait and see" strategy potentially costly.
Foreign buyers should focus on properties that offer genuine value rather than chasing the hottest markets. For buyers entering the market now, positioning in emerging secondary markets within Costa Blanca may offer better long-term appreciation potential than purchasing in fully-valued central locations like Benidorm or Javéa.
A qualified bilingual lawyer is essential for any Spanish property purchase. They handle the contract from arras through completion, structure the deal tax-efficiently, and represent your interests at notary. That part is non-negotiable.
What's worth doing earlier — before you instruct a lawyer or sign anything — is checking the property's legal record yourself. The nota simple from the Land Registry shows embargos, undisclosed mortgages, planning irregularities, and registered size discrepancies. PropDue's Legal Review retrieves that document and explains in plain English what's on it, so you know what you're dealing with before you put down €10,000 in arras.
Finally, buyers should secure mortgage pre-approval before house-hunting. Quality properties in popular Costa Blanca hotspots like Jávea, Dénia, and Altea still attract fast interest. Buyers should have financing, documentation, and decision-making aligned before viewing. In a rising market, delays in securing financing can mean losing out on properties or facing even higher prices by the time approval comes through.
Get the title, ownership, and public records checked before you commit.
Legal Review — €79