The lack of supply of affordable housing could limit the growth of sales in the remaining part of 2025 (0.5%) and 2026 (0.3%), while the insufficient construction of new homes will increase property prices both in 2025, around 10%, and in 2026, around 7%, according to Agency data Real estate observatory by BBVA Research from October 2025.
“Price increases will continue to show the imbalance between supply and demand,” emphasized economists from BBVA Research, who pointed out that new housing construction will increase by 10% in 2025 and 12% in 2026. In the first half of 2025 prices grew by 9.7% at an interannual rate. Despite this, the price, in real terms, is still 30% below the 2007 highs.
The product shortage also affects rents, where rents show more intense increases than those of the sales product, 34% versus 22% between 2019 and the second quarter of 2025. Economists at BBVA Research underlined that the supply shortage combines structural and cyclical factors that feed on each other.
Among the former, the slowness in territorial development, regulatory uncertainty and labor shortage, which translate into high costs and relatively low returns compared to what is observed in other eurozone countries, which explains the low investments.
In particular, despite the recovery of margins, the percentage impact of sales on total assets is very low. This is due to the excessive time required from purchasing the land to its construction. “The result is assets that are financed mainly with own resources, but which take a long time to become profitable”, explain the experts, who underline that this problem is particularly important for SMEs, which represent the largest percentage of the sector’s production fabric.
Accelerate deadlines
To make investments in the sector more attractive, the report states that “accelerating the time to transform land must be a priority. Furthermore, it would be appropriate to improve regulation, influence the reduction of operating costs of companies and improve productivity”.
BBVA Research highlighted that regulatory uncertainty is another element that directly impacts investments. Therefore, recent measures related to rent price control, restrictions on large landlords and the failed attempt to reform land law have increased the perception of risk in the market.
Another challenge facing the sector is a shortage of skilled labor and a high number of unfilled vacancies, including essential trades such as bricklayer, plumber or electrician. While immigration has helped maintain the business, the lack of training programs and effective job training policies limits growth, experts said.
Economists agree that labor shortages will continue to pose a medium-term challenge for construction. In this sense, they underlined the need to move towards greater political and institutional consensus that would allow structural reforms to be undertaken and the housing supply to be relaunched.
“Although the increase in resources envisaged by the 2026-2030 Housing Plan is a step in the right direction, the lack of coordination between administrations can make it difficult to achieve the set objectives,” explain the economists.
