Summary
- Housing prices in Alicante’s key tourist towns-benidorm, Torrevieja, and Orihuela-continue to rise sharply, with Benidorm leading nationwide with a 19.6% annual increase.
- The average cost per square meter in benidorm is now €2,214, surpassing the provincial average by 33%.
- Torrevieja and Orihuela also see important price hikes (~10% and 7% respectively), with growing affordability challenges for residents.
- Benidorm ranks among the five coastal towns where housing prices exceed those of their provincial capitals by 5% to 29%, highlighting a strong local real estate demand.
- Mortgage effort rates in Benidorm, Marbella, and Torrevieja surpass 60% of average household income, pointing to potential affordability crises.
- The national housing price average rose by 9.8%, but the number of municipalities experiencing above-average growth declined.
Sharp Rise in Housing Prices hits Alicante’s Coastal Towns
Recent data from the latest Tinsa housing price report reveal that the cost of buying property in Alicante province continues to climb rapidly, especially in well-known tourist hotspots such as Benidorm, Torrevieja, and Orihuela. These popular destinations along Spain’s famed Costa Blanca are setting new records in housing price growth, impacting residents and investors alike.
Benidorm Leads National Housing Price Growth
According to Tinsa, benidorm experienced a staggering 19.6% year-on-year increase in housing prices up to June 2024, marking it as the municipality with the largest price hike nationwide. The average price per square meter in Benidorm now stands at €2,214/m², well above the national average of €1,955/m² and a significant 33% higher than the average for the Alicante province.
Despite this headline surge, Benidorm’s average price remains below the highest in Spain, with Madrid and Pozuelo de Alarcón in Madrid topping the charts at €4,457/m² and €4,228/m² respectively.
| Municipality | Annual % Price Increase | Price €/m² | Mortgage Effort (% Income) |
|---|---|---|---|
| Benidorm | 19.6% | 2,214 | 61% |
| Torrevieja | 10.0% | 1,691 | 60% |
| Orihuela | 7.0% | 1,689 | 46% |
| Marbella | 17.2% | – | 76% |
| Alicante (city) | – | – | – |
Torrevieja and Orihuela: Rising prices and Affordability Challenges
Torrevieja and Orihuela, both in the Vega Baja comarca, are also experiencing notable price increases. Torrevieja’s housing price surged by 10% over the last year to an average of €1,691/m², while Orihuela recorded a 7% rise to €1,689/m². These figures are close to the average prices found in Alicante city but reflect rapidly rising costs in these traditionally more affordable areas.
A key concern highlighted by Tinsa is the mortgage affordability effort - the percentage of average household income required to cover mortgage payments. Benidorm, Torrevieja, and Marbella rank highest in Spain, with households needing over 60% of their income to cover mortgage costs. This substantially exceeds the recommended 35% threshold, underscoring growing financial pressure on local buyers.
Broader National Context: Who’s Winning and Losing?
While the national average price for housing grew by 9.8% in the last year, the number of municipalities recording above-average increases declined from 32% to 24%. Price rises remain concentrated mainly in Mediterranean coastal areas, the Canary Islands, parts of Cádiz, northern coastal regions, and metropolitan zones of Madrid and Barcelona.
Notably,80% of municipalities surveyed experienced quarterly price increases,with Benidorm again leading at +5.5%, ahead of Marbella (+4.9%) and Gijón (+4.8%). Meanwhile,some inland cities like Ponferrada and Alcoy show much lower prices and slower growth,with Alcoy’s price per square meter at just €890,nearly half the Alicante provincial average.
Benidorm’s Unique Position
- Ranked 3rd among coastal towns where housing prices surpass those of their provincial capitals, trailing Marbella and Vigo.
- Housing price 33% above Alicante province average, highlighting growing real estate demand and emerging affordability gaps.
- Strong quarterly growth (+5.5%) reflects ongoing market dynamism despite wider national cooling.
These trends reflect the pull of Alicante’s coastal municipalities as attractive locations for residents, tourists, and investors. However, the rapid rise in housing costs and mortgage burden raises pressing questions about market sustainability and local affordability moving forward.
Key takeaways for Buyers and investors
- Prepare for rising costs: Prices show no signs of stabilizing soon, especially in peak tourist areas like Benidorm.
- Evaluate mortgage capacity carefully: Many households face mortgage efforts well above 35%, increasing financial risk.
- Consider market hotspots and alternatives: While Benidorm dominates growth stats, neighboring towns like Torrevieja and Orihuela also present strong price momentum.
- Stay informed: Monitor quarterly and yearly trends as the market may vary regionally and seasonally.
Conclusion
As Alicante’s coastal towns continue to attract residents and investors, the region is facing a pronounced housing price inflation that reshapes affordability landscapes. Benidorm’s leadership in price increases highlights its enduring appeal but also signifies potential challenges for local buyers. Torrevieja and orihuela’s rising costs add to the pressure, suggesting that affordability could become a growing concern across the Costa Blanca.
For prospective buyers, investors, and policymakers alike, staying updated with trusted sources like Tinsa’s market reports is essential to navigate this dynamic and evolving real estate surroundings.
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