Despite the fact that in 2025, building permits were issued for 162,200 housing units (the maximum since 2008), this is catastrophically low. During the year, 226,000 new households were created, so the gap between supply and demand continues to grow.
The key problem is bottlenecks at the project completion stage. In the 12 months to September 2025, only about 83,500 housing units were completed, an increase of only 2% in annual terms. The gap between the permits issued and the facilities actually commissioned has reached its maximum since 2010. Factors hindering construction include labor shortages, supply delays, problems connecting to the power grid, and heavy regulatory workload.
In 2026, it is unlikely that more than 100,000 housing units will be completed, which is clearly insufficient to cover demand. Even with the growing number of permits, supply has not kept pace with the creation of new households, and the deficit continues to deepen.
This imbalance puts direct pressure on prices.In the 4th quarter of 2025, they grew by 12.9% year-on-year. Real estate prices are particularly high in the tourist provinces and economic centers (Balearic Islands, Malaga, Valencia, Madrid), where the rise has reached double digits.
According to market players, it is necessary to drastically simplify the procedures for issuing permits and urban planning processes, as well as to intensify construction on existing state land. Without this, the shortage of new housing will remain the main factor affecting the market, and prices will continue to rise.
Source: CaixaBank
