7 issues of the prime property market in Spain

Real Estate Technology with Casafari

Market share through foreign buyers in Spanish holiday destinations is 60-90%. The average purchase price is €800K. Yet the market is underserved and is in chaos. Here are 7 reasons why.



  Copyright: Casafari.com, All Rights Reserved

We asked prime real estate buyers in Spain, France and Portugal

We (Team @ Casafari.com) conducted multiple interviews with potential buyers and owners of prime properties in Spain, Portugal, and France.

  • All of the interviewed customers are non-residents meaning they are foreign buyers in the non-native to them markets.
  • All of them bought a second home or holiday property in the above-mentioned countries.
  • Each property is prime with a price above average.


Why are real estate buyers in Spain dissatisfied?

Our interviews with prime property buyers in Spain have shown that there are serious issues on the market.

  • Real Estate buyers, especially foreign non-residents and expats in Spain, make up to 60-90% of the residential real estate market in popular holiday destinations (such as Balearic Islands, Catalunya, Alicante, Malaga)
  • This number reflects the global trend of foreigners dominating prime property market (source: FT.com)
  • In 2013-2014, the average purchasing price through foreign buyers / non-residents was €800K
  • Yet the "niche" of second homes and holiday properties is currently underserved
  • 100% of interviewed property buyers admitted, their real estate agents were lacking competence and were delivering a poor service. 


We conducted interviews with 19 real estate agencies in Spain

When property buyers complain about realtors, we ask the source of the evil about the reasons.
So we conducted interviews with real estate agents, too.

We came to the conclusion that realtors also suffer because of

  • just 10% exclusive listings
  • high competition - every realtor has same properties as the next-door broker
  • every realtor fights for the same client
  • realtors spend up to 40% of their time analysing competitors and there is no automation of these processes existing
  • usually, when there is a property listed among 10+ agencies, only 1-2 are in a direct contact with the seller
  • because agencies copy listings from each other
  • and when there are price or status changes, only a small portion of agencies are acknowledged
  • hence prices on properties differ
  • and there are 1000s of properties still in the portfolios of agencies that were sold the long time ago (let's call them property-corpses)


Technology will help us to find and solve problems!

If both, selling and buying parties suffer and all want to have a better service, there must be deeper reasons, we thought. We decided to investigate with the help of the latest technologies and Artificial Intelligence.

  • We have localised one market. Our choice - Mallorca (also known as Majorca) in Balearic Islands, Spain.


1. Because Mallorca is the fastest growing real estate market in Spain.

2. The Islas Baleares Province is one of the most stable places for the real estate investment in Spain. (Source: Forbes.com)

3. Five of Spain's 10 most expensive properties are located on this island. (source:Telegraph.co.uk Luxury)

4. The market share through foreign property buyers in Mallorca is 80%. (source:

Ibestat - Statistics Institute of Balearic Islands

  • We aggregated and matched all the properties from major agencies offering their service on the island.
  • As a result, Casafari.com unintentionally became a showcase of the ultimate chaos on the luxury real estate market in Spain.

Here is what we found out:



  Copyright: Casafari.com, All Rights Reserved

Why does Casafari.com help real estate agents?

We are a team of experienced entrepreneurs who have been working together for several years and have built 3 large globally successful internet technology startups. We enjoy working together and as a team we are strong as we complement each other's skills. But it was time to move on, to build something new and different from our previous ventures. 
Our choice fell on the prime real estate abroad as we wanted to solve our own problem and the market itself is immensely interesting.

At the beginning of our customer development journey, we were confident to work for and on behalf of the real estate buyers. After all the interviews, research, and analyses, we had the A-HA moment. But different than we expected at first.

At first, we thought to build a completely different product to what is live now at Casafari.com. 
However, thanks to the customer development methodology invented and developed by Steve Blank, we could identify the real problems. 
Answering the 7 innovation questions of Peter Thiel described in his book "Zero to One", we came to the product proposition that would save realtor's time min. 10-fold!

So we became the real estate search in Spain.



 Copyright: Casafari.com, All Rights Reserved

Casafari's ultimate goal is satisfaction of all parties

While conducting the customer interviews and analysing the market, we realised, if we do all the efforts for the buyer but skip solving the core problem, we will fight with windmills.


We decided to bring transparency to the market by:

  • helping real estate agents with the competitive analysis and 10x save their time
  • sending a regular portfolio benchmarking feed
  • automatically updating realtors on status and price changes in real time
  • helping with the lead generation.

Following the Lean Startup methodology, we have developed and launched a Minimum Viable Product and collected the feedback from our potential B2B (agents) and B2C clients (buyers). The perception has been great and we will move towards the target described in this post, with the means mentioned above. 


If we help real estate brokers to automatize their work they spend the most time on, they will unlock more time to focus on a better service for the buyers. 
Our ultimate goal is the satisfaction of all parties, especially in the segment of prime properties in Spain, France, Italy, Greece, Portugal, and other countries popular among second home buyers.

Do you think the mentioned points would be enough to improve the market? 
Or do you know about other problems to be solved that would save time and money of all parties in the real estate selling-buying process?



Comments (15)

Sam Shueh
(408) 425-1601 - San Jose, CA
mba, cdpe, reopro, pe

Great source for Spainish properties. Q1 What is the general property tax rate?

Q2 Do buyers have to pay realtor a finder fee?



Sam Shueh

Sep 19, 2015 01:52 AM
Casafari com

Hello Sam, glad you liked my post. 
Good questions!

Here are my answers:
A1: The purchasing cost consists of several elements (taxes, notary, deed registration) and ranges between 9% and 13% of the purchase price. Taxes depend on the property value, type (old private / new private / commercial / plot / garage) and several other factors. 

As it is not so easy for the foreign buyer to understand what he needs to pay while buying property in Spain, we will launch an online calculator of the purchasing cost soon.

However, all the information and real life calculations were included into our "Spanish Property Buyer'S Guide" and I am working on the ebook now. http://www.casafari.com/buyers-guide-2015-mallorca-ibiza-balearic-islands-spain/

A2. Actually, real estate agents are paid by the seller. The fee is already included into the published by a realtor purchase price. Most transactions in Europe are dual agency's deals, where an agent represents both, buyer and seller. Agents charge in average 5% + VAT. 

Sep 20, 2015 08:47 AM
Sam Shueh
(408) 425-1601 - San Jose, CA
mba, cdpe, reopro, pe

Forgot Welcome to AR

Hope to hear from you in the future.


Sep 19, 2015 02:02 AM
Casafari com

Thank you! 

Sep 20, 2015 08:47 AM
Tony and Suzanne Marriott, Associate Brokers
Serving the Greater Phoenix and Scottsdale Metropolitan Area - Scottsdale, AZ
Haven Express @ Keller Williams Arizona Realty

Casafari com Welcome to Active Rain!  As someone who has been here (on and off) for close to 9 years, it's well worth it!

Sep 19, 2015 02:19 AM
Casafari com

100% agree! It is worth it. I and my co-founders purchased several properties in Spain before we decided to solve existing problems and make life of other buyers from outside of Spain easier. While trying to help buyers we understood that realtors need our help even more. And this is what makes it even more exciting for us to work in the real estate industry!

Sep 20, 2015 08:50 AM
Kat Palmiotti
406-270-3667, kat@thehousekat.com, Broker, eXp Realty - Kalispell, MT
Helping your Montana dreams take root

Welcome to ActiveRain.  This is an interesting overview of the real estate market in Spain -- I can't imagine have the same home listed by ten different agents at different prices. That must be incredibly confusing.

Sep 19, 2015 03:06 AM
Casafari com

Hello Kat, thank you for welcoming me and my team here! 
Indeed, it is even more frustrating to buy a property and find it later still listed at another selling agent for a lower price. :-)

We found (and saved) several cases like this. For instance, just three days ago one villa that was listed at one agency for EUR 800,000, was sold for EUR 850,00 at another, bigger agency.

Sep 20, 2015 08:52 AM
Gary Coles (International Referrals)
Venture Realty International - Las Vegas, NV
Latin America Real Estate

Welcome to ActiveRain and congratulations on your first post  --- wow  - what a post.  I read the entire thing plus looked at some of your other materials and am fascinated.  I also have lots of questions and ideas.  I hope to see many more posts from you in the future.   First question  - exactly what do you mean by "prime property"?

Sep 19, 2015 03:12 AM
Casafari com

Hello, Gary! Thanks for welcoming us here.
Your enthusiasm encourages me to write my next post sooner here. There is so much to share!

After the Spanish housing crisis in 2008 tens of thousands of houses have remained unsold.

On the other hand, luxury properties in Spain are being sold at a higher rate than ever before. To avoid any confusion between "bad properties" and "luxury houses", it is important to segment the real estate market in Spain.

It is common to define luxurious apartments and villas as "prime properties" that
1. are located in prestigious areas with high demand by international buyers hence stable value,
2. cost more than the average house popular among local residents (as a rule, for apartments EUR 500K+, for villas EUR 800K+).

I hope I could answer your question. 

Sep 20, 2015 09:28 AM
Captain Wayne - Rowlett Real Estate School
Rowlett Real Estate School - Panama City, FL
Rowlett Real Estate School / Owner and Instructor

Great job on your first blog post here in ActiveRain!  Thanks for the info!


Sep 19, 2015 11:29 AM
Captain Wayne - Rowlett Real Estate School
Rowlett Real Estate School - Panama City, FL
Rowlett Real Estate School / Owner and Instructor

Welcome to ActiveRain!  It's great to have you aboard.  I look forward to seeing more of your posts!

Sep 19, 2015 11:29 AM
Casafari com

Thank you for welcoming and reading the post. Glad you liked it! 

Certainly, I will post here more. 

Best Regards!

Sep 20, 2015 09:30 AM
Barbara Todaro
RE/MAX Executive Realty - Retired - Franklin, MA
Previously Affiliated with The Todaro Team

Good morning, Casafari com nicely created first post and very interesting.... I'm looking forward to reading more about what you do and your thoughts as various markets change....

Sep 19, 2015 08:46 PM
Casafari com

Thank you, Barbara! I will work on my next post here soon. 

Sep 20, 2015 09:38 AM
Barbara Todaro
RE/MAX Executive Realty - Retired - Franklin, MA
Previously Affiliated with The Todaro Team

and welcome to ActiveRain....I hope you enjoy participating on this platform...it's a great place to learn, share, market and network....enjoy and blog away...

Sep 19, 2015 08:47 PM
Mery Fernandez Empire Network Realty Luxury Brokerage
Empire Network Realty INC. - Orlando, FL
The Rise of An Empire, Let's Build Yours!

Hi Casafari!! Welcome to the world of Activerain, may your blogging  create a whole new chapter in your Real Estate Career.

Sep 21, 2015 12:25 AM
Casafari com

Many thanks for your wishes, Mery! 

Sep 21, 2015 12:40 AM
Christine Donovan
Donovan Blatt Realty - Costa Mesa, CA
Broker/Attorney 714-319-9751 DRE01267479 - Costa M

Casafari - It sounds like things work very differently in Spain than what we are used to here.

Oct 05, 2015 04:06 PM
Christine Donovan
Donovan Blatt Realty - Costa Mesa, CA
Broker/Attorney 714-319-9751 DRE01267479 - Costa M

Casafari - Congrats on your first post here in the Rain, and welcome to the community.

Oct 05, 2015 04:06 PM
Christine Donovan
Donovan Blatt Realty - Costa Mesa, CA
Broker/Attorney 714-319-9751 DRE01267479 - Costa M

Please know that the ambassadors, those with orange badges, are here to help and answer questions.

Oct 05, 2015 04:06 PM
Fred Griffin Florida Real Estate
Fred Griffin Real Estate - Tallahassee, FL
Licensed Florida Real Estate Broker

 We invite you back to ActiveRain!  

     Much has changed since your last blog post.  

     We would welcome your return.

Aug 17, 2017 04:13 PM
Peter Spain
Cancasa - Punta Cana, DR

Much of what you say is true of the Spanish property market. The idea looks great and I hope it goes well.

Sep 08, 2020 03:40 AM