Since the property crash, many challenges have stemmed from Spanish negative equity. However, recent reports from Spanish Property Insights suggest that property prices in the country have finally returned to the highs last seen in 2007. At first glance, this appears to be positive news for owners. However, once inflation is factored in, values are still well below their pre-crash peak. For many Spanish property owners, this reality continues to impact mortgages and debt.
Nominal vs Real Prices
In 2025, the average house price in Spain is approximately €1,883 per square metre. This matches the 2007 peak. But in real terms, the picture is different. Adjusted for inflation, today’s figure equals about €1,346 in 2007 money. This is still roughly 26 per cent lower than the housing boom peak.
So, while the numbers may suggest recovery, many buyers who purchased at the market’s peak have not yet regained their original investment. They may also have agreed on initial long interest-only terms on their mortgage, further exacerbating the problem.
The Impact on Foreign Owners
Between 2004 and 2008, thousands of UK and Irish buyers purchased property in Spain. Prices were inflated, and mortgages were often large. Since then, many owners have faced:
- Negative equity, with mortgages higher than property values.
- Difficulty selling at a price that clears the debt.
- Pressure from Spanish banks or debt collection firms.
The latest figures show that the market has improved. But for those caught with historic debt, the challenges remain.
How EU Property Solutions Can Help with Spanish Negative Equity
EU Property Solutions supports clients with overseas property issues. We have helped many owners settle long-term arrears and resolve cases of negative equity.
If you face unaffordable repayments, threats of repossession, or debt chasing long after leaving Spain, our team can guide you. Our experience enables us to negotiate effectively with lenders and find a way forward.
Spanish property prices may appear to be back at 2007 levels. But in reality, inflation means values remain well below that peak. For owners still carrying debt, this creates financial strain. If you are encountering issues with your property investments, EU Property Solutions can provide the advice and solutions you need.
