Castellón’s Housing Market: A Record-Breaking Surge and What It Means for Investors
The province of Castellón is experiencing an unprecedented boom in home sales, fueled by a thriving construction sector and the increasing appeal of second-hand properties as investment opportunities. According to data released by the National Statistics Institute (INE), 2025 witnessed a historic high in real estate transactions, with a total of 14,271 sales recorded – a 10.5% increase from 2024.
A Decade of Growth: From Recovery to Record
This surge represents a remarkable turnaround from the economic crisis of 2008. In fact, the number of home sales has more than doubled in the last decade. While 5,652 sales were registered in 2015, 2025 shattered previous records, averaging nearly 2,000 sales per month.
The Rise of the Investor: Second-Hand Homes Lead the Charge
A significant driver of this growth is the influx of investors targeting second-hand properties. Nuria Marco, Vice President of COAPI Castellón, explains that “the vast majority of buyers of second-hand homes are investors.” These investors are drawn to the higher returns offered by real estate compared to traditional savings accounts. Many are acquiring properties, renovating them, and then renting them out, particularly for seasonal or tourist accommodations.
In 2025, 11,528 transactions involved second-hand homes, a 14% increase compared to the 10,109 recorded in 2024.
Modern Construction: A Steady, Though Slightly Slower, Pace
While the second-hand market is booming, new construction remains a vital part of the equation. However, demand for new builds experienced a slight decrease compared to 2024, with 2,743 transactions – a 2.1% year-on-year decline. Despite this minor dip, the construction sector is demonstrably active after years of stagnation.
Financing the Boom: Mortgages on the Rise
The accessibility of mortgage financing has played a crucial role in this market upswing. Mortgage approvals reached a record high in 2025, with 8,070 operations – a 32.2% increase year-on-year. The total amount lent by banks also surged, reaching €820.8 million, a 50% increase from 2024. The average mortgage amount increased by 13.2% to €101,710.
Currently, 56.5% of home purchases are financed with a mortgage, a significant increase from 47.2% in 2024.
Impact of Regulations: Housing Law and Protected Housing
Changes in legislation are also influencing the market. The Spanish Housing Law has limited the availability of long-term rentals, pushing investors towards short-term and tourist rentals. The reclassification of publicly protected housing (VPP) built in the 1970s has added more properties to the private market, increasing options for investors.
Looking Ahead: What Does This Mean for the Future?
The current trends suggest that Castellón’s housing market will remain dynamic. The demand for rental properties, driven by investors, is likely to continue, potentially leading to increased rental prices. The availability of mortgage financing will be a key factor in sustaining the growth of new construction. The interplay between regulations and market forces will continue to shape the landscape, creating both opportunities and challenges for buyers and investors alike.
FAQ
Q: What is driving the increase in home sales in Castellón?
A: The surge is driven by a combination of factors, including a strong construction sector, attractive investment opportunities in second-hand properties, and increased access to mortgage financing.
Q: Are first-time buyers still able to enter the market?
A: While investors are a significant force, new construction offers opportunities for first-time buyers, particularly with favorable mortgage conditions.
Q: What impact is the Housing Law having on the market?
A: The Housing Law has limited the supply of long-term rentals, encouraging investors to focus on short-term and tourist rentals.
Q: Is the increase in home sales sustainable?
A: The sustainability of this growth will depend on continued economic stability, access to financing, and the evolving regulatory landscape.
Did you know? The amount lent by banks for mortgages in Castellón increased by 50% in 2025 compared to the previous year.
Pro Tip: If you’re considering investing in Castellón’s property market, research local regulations and consult with a real estate professional to understand the potential risks and rewards.
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