Valencia

Valencia faces a severe housing crisis in 2025, marked by a rapid surge in prices, intense competition, and a persistent imbalance between demand and supply. The average price for homes has reached €2,886 per square meter, rising over 22% year-on-year—among the highest in Spain. Rental vacancy rates sit at only 6%, while rents continue to climb sharply, putting further strain on affordability for many residents. The shortage is most pronounced in popular central neighborhoods but affects the broader city as well, exacerbated by limited new housing construction and above-average demand from both locals and international buyers.

The crisis hits hardest for renters, especially young professionals, families, students, and vulnerable populations unable to access ownership or meet escalating rental costs. First-time buyers find themselves priced out of the market, and lower- to middle-income households struggle to secure housing or cope with rent hikes. Demand for available properties far exceeds supply, leading to high occupancy rates and swift turnover for any listings. The structural shortage of housing in Valencia places particularly heavy pressure on those without stable employment or substantial savings, with the city's affordable and social housing stock representing only a minimal fraction of actual need. These dynamics generate widespread economic stress, delaying household formation and fueling social discontent among those most exposed to the rising cost and scarcity of homes.

The Valencia city administration addresses affordable and sustainable housing primarily through new national and local measures focused on increasing the public and social housing stock, enhancing regulation, and incentivizing both construction and rental market stability.

Recent targets communicated for the sector include growing the share of publicly managed affordable units by incorporating 3,300 homes and 2 million square meters of residential land into a new Public Housing Company, with a further goal of integrating over 30,000 homes from Spain’s “bad bank” (SAREB), 13,000 of which are immediately available. There is also a focus on regulatory changes and expanded subsidies, aiming to launch a new National Housing Plan in 2026 with special support for young people, the elderly, and vulnerable groups.

Key programs and activities include:

• The PERTE de Viviendas, an innovation initiative piloted in Valencia, which accelerates industrialized and modular housing construction for more affordable and sustainable units.
• Public financial guarantees for affordable rental, especially for tenants and landlords under age 35.
• Grants for refurbishing vacant dwellings in exchange for offering them as affordable rentals.
• 100% income tax exemption for owners renting at regulated, below-market rates.
• Stricter regulation and registration of short-term rentals, along with new penalties and inspection resources to limit housing loss to tourist accommodation.
• A local subsidy program offering a 40% rent subsidy to qualifying residents, in addition to youth rental assistance.

These programs are complemented by rent control mechanisms and expanded tenant protections to address short-term price spikes and vulnerability.

Valencia’s housing market in 2025 is marked by rapid growth and high demand. About 67% of residents own their homes, while approximately 33% rent. Median purchase prices for apartments have surged to €2,607–€2,886 per sqm, reflecting a 20–24% year-over-year increase—making Valencia Spain’s fastest-growing major city for property values. Median rental prices average €13–€16 per sqm monthly, with short-term rentals, like Airbnb, achieving roughly €99 per night and high occupancy rates.

Publicly owned housing, mostly managed by local authorities, plays a modest role in Valencia, representing only about 2% of the city’s total housing stock—a typical figure for Spain. Social housing is defined by income-based eligibility and focuses on making ownership, not renting, accessible for lower-income or vulnerable groups. Thus, in Valencia, public housing generally refers to housing promoted and managed by the administration, while social housing (VPO: Vivienda de Protección Oficial) is means-tested and often designated for purchase at below-market prices rather than for rental.

While both public and social housing aim to increase affordability, they differ in focus: public housing is broader in its administration and may include initiatives for rental or rehabilitation, while social housing in Valencia primarily consists of subsidized homes sold under income restrictions and not commonly rented. Overall, public and social (VPO) housing covers a very limited share of the housing market in Valencia.