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Granada's property market is experiencing significant growth with double-digit price increases and strong international demand driving the market forward.
As of September 2025, Granada city shows average property prices of €2,507 per square meter, with the city center reaching up to €2,848 per square meter. The market has seen remarkable growth with asking prices up 16.71% year-on-year in the city and 12.95% across the province. This growth trajectory is expected to continue, though at a more moderate pace, with forecasts suggesting 5-8% annual growth in the short term and 3-5% in the long term.
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Granada's property market is in a strong growth phase with prices up 16.71% year-on-year in the city center, driven by low supply and high demand from both local and international buyers.
Central Granada offers the highest appreciation potential while coastal areas like Salobreña provide good rental yields, making the market attractive for both personal use and investment purposes.
| Area | Average Price (€/m²) | 12-Month Trend | Investment Outlook |
|---|---|---|---|
| Granada City Center | €2,848 | +16.71% | Highest appreciation potential |
| Granada City Average | €2,507 | +16.71% | Strong growth expected |
| Norte District | €1,392 | Slowest growth | Best value for budget buyers |
| Salobreña (Coastal) | €1,925 | +11% | Good rental yields |
| Province Average | €1,649 | +12.95% | Moderate growth |
| Rural Areas | €1,123+ | Stable/flat | Lower appreciation |
What's the current average price per square meter for different property types in Granada?
Granada city shows an average property price of €2,507 per square meter as of September 2025.
The city center commands the highest prices, reaching up to €2,848 per square meter, while the Norte district offers the most affordable options at €1,392 per square meter. This represents a significant price variation within the city, with central locations commanding more than double the price of peripheral areas.
Across the broader Granada province, the average price sits at €1,649 per square meter, with a wide range from €122 to €3,745 per square meter depending on location and property type. Coastal areas like Salobreña show intermediate pricing at €1,925 per square meter, particularly for beachfront apartments which are highly sought after by international buyers.
Rural properties in areas like Vélez typically start around €1,123 per square meter, offering the most affordable entry point into the Granada property market.
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How have property prices in Granada changed over the past 12 months?
Granada's property market has experienced remarkable growth over the past 12 months, with asking prices in Granada city rising by 16.71% year-on-year from July 2024 to July 2025.
The Granada province as a whole has seen a strong 12.95% increase in property prices over the same period. This growth significantly outpaces inflation and represents one of the strongest property market performances in the region.
Rental prices have also increased substantially, rising 8.42% year-on-year, with the current average rental rate at €10.69 per square meter per month. The city center shows the highest rental rates at €11.94 per square meter per month, while the Genil area offers the lowest at €9.19 per square meter per month.
Coastal areas like Salobreña have shown particularly strong performance for beachfront apartments, with prices up 11% year-on-year, demonstrating the international appeal of waterfront properties in the region.
This price growth has been driven by a combination of low inventory, strong demand from both local and international buyers, and limited new construction relative to demand.
What's the short-term (next 6–12 months) price forecast for Granada's property market?
The short-term outlook for Granada's property market remains positive, with continued price growth expected over the next 6-12 months.
Market analysts forecast property price increases of 5-8% over the next year, particularly in Granada city center and other established central locations. This growth will be supported by persistently strong demand from international buyers and low housing supply.
The rental market is expected to maintain its strength, with rental yields continuing to benefit from tourism recovery, student demand, and the growing remote work trend. Central areas and properties near the university are likely to see the strongest rental demand.
New builds and modern apartments in central locations are expected to outperform the overall market, as buyers increasingly seek move-in ready properties with contemporary amenities.
However, affordability pressures may begin to moderate growth rates slightly, particularly in the lower-priced segments where first-time buyers are most active.
What's the medium-term (1–3 years) outlook for property prices in Granada?
The medium-term outlook for Granada's property market shows continued growth, though at a more moderate pace than the current double-digit increases.
Property price growth is expected to settle into a 5-7% annual range over the next 1-3 years. Central areas, new builds, and properties with proximity to key amenities are forecasted to outperform this average.
The ongoing undersupply of new homes relative to demand will continue to support price growth, as less speculative building compared to previous decades means lower risk of oversupply. This structural imbalance favors continued appreciation.
International interest in Granada is expected to remain strong, particularly from buyers seeking character properties in the historic city center and coastal retreats in areas like Salobreña. This international demand provides a solid foundation for medium-term growth.
Rental yields are likely to remain attractive, especially for properties positioned to capture tourism and short-term rental demand, though some moderation in yield growth is expected as purchase prices continue to rise.
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What's the long-term (3+ years) projection for Granada's housing market?
The long-term outlook for Granada's housing market remains fundamentally positive, with sustained demand expected to drive continued price appreciation over the next 3+ years.
Most analysts project annual price growth to moderate to 3-5% per year as affordability pressures mount and the market matures. This represents a normalization from current exceptional growth rates while still providing solid returns for property owners.
The ongoing international interest in Granada, particularly for character city homes and coastal properties, provides a strong foundation for long-term demand. The city's historical significance, cultural attractions, and relatively affordable prices compared to other European destinations support this trend.
The structural undersupply of housing relative to demand is expected to persist, as new construction continues to lag historical averages. This supply constraint should continue to support price appreciation over the long term.
Climate considerations and the appeal of Mediterranean coastal living are likely to drive continued international interest, particularly as remote work becomes more established and buyers seek lifestyle-focused property investments.
How do prices and trends differ between central Granada, surrounding suburbs, and nearby rural areas?
Central Granada significantly outpaces both suburban and rural areas in terms of price appreciation and market activity.
The city center (Centro) commands the highest prices at €2,848 per square meter and shows the fastest growth rates. Rental rates in the center reach €11.94 per square meter per month, reflecting strong demand from tourists, students, and professionals seeking prime locations.
Suburban areas like Norte offer more affordable options at €1,392 per square meter but show the slowest growth in the city. These areas appeal primarily to budget-conscious buyers and families seeking more space at lower price points.
Rural properties in areas like Vélez start around €1,123 per square meter and typically show stable to flat price appreciation. These properties are slower to sell and often require significant renovation to attract buyers, limiting their appreciation potential.
Coastal areas like Salobreña occupy a middle ground at €1,925 per square meter, with beachfront apartments showing strong 11% year-on-year growth. These areas benefit from tourism demand and international buyer interest, though they don't match central Granada's appreciation rates.
It's something we develop in our Nicaragua property pack.
Which property types in Granada are showing the strongest demand right now?
Apartments and new builds in central locations are experiencing the strongest demand in Granada's current market.
Modern apartments in the city center are particularly sought after by both local and international buyers who value move-in ready properties with contemporary amenities. These properties often sell quickly and command premium prices.
New builds across all areas are in high demand, as buyers increasingly prefer properties that don't require immediate renovation or maintenance. The limited supply of new construction relative to demand drives strong competition for these properties.
In coastal areas like Salobreña, beachfront apartments are extremely popular among international buyers seeking vacation homes or rental investment properties. The combination of sea access and tourism potential makes these properties highly desirable.
Well-located townhouses and villas in suburban areas show steady demand, particularly from families and buyers seeking larger living spaces. However, this demand is less intense than for central apartments and new builds.
Traditional or rural homes face slower sales unless they have been extensively renovated to modern standards, as buyers increasingly expect contemporary amenities and move-in ready conditions.
What's the current average rental yield for each area and property type in Granada?
Granada city typically generates gross rental yields of 4-5% for standard residential properties, with variation based on location and property type.
The best-performing Airbnb listings in premium locations can achieve up to €2,642 per month in rental income, significantly outperforming traditional long-term rentals. These high-performing properties are typically located in central areas with strong tourist appeal.
Rental yields tend to be slightly higher in lower-priced districts or areas near the university, where strong student demand supports consistent occupancy rates. Properties near educational institutions benefit from year-round rental demand.
Coastal areas like Salobreña often show lower percentage yields due to higher purchase prices, but benefit from strong seasonal rental demand that can command premium rates during peak tourism periods.
Rural properties show highly variable yields, often lower than urban areas due to reduced demand and longer vacancy periods. However, unique or well-positioned rural properties can occasionally achieve attractive yields for the right buyer.
Properties optimized for short-term rentals in central Granada or coastal areas generally outperform traditional long-term rental yields, though they require more active management and are subject to seasonal fluctuations.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Nicaragua versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.
What is the current supply vs demand situation for both sales and rentals?
Granada's property market is characterized by low supply and high demand, creating a clear sellers' market across most segments.
Property listings have dropped significantly from 100-120 per week to just 60-70 per week in Granada, indicating tight inventory levels. This reduction in available properties has contributed to the rapid price appreciation seen over the past year.
The under-building trend persists compared to historical averages, with new construction continuing to lag demand. This structural supply shortage supports continued price growth and reduces the risk of market oversupply.
Quality homes and properties in central locations face particularly strong competition, often selling quickly and sometimes above asking price. Buyers in these segments need to be prepared to move rapidly when suitable properties become available.
The rental market shows similarly strong demand, driven by tourism recovery, student enrollment, and the growing number of remote workers choosing Granada as their base. This demand supports both traditional and short-term rental markets.
Sellers currently hold significant negotiating power due to the supply shortage, while buyers often face competition and limited choice, particularly for desirable properties in prime locations.
If buying for personal use, which areas and property types offer the best quality-to-price ratio right now?
Centro and Zaidín offer the best balance of quality and value for personal use buyers in Granada's current market.
Centro provides the ultimate lifestyle experience with access to historical sites, restaurants, and cultural amenities, though buyers must be prepared to pay premium prices up to €2,848 per square meter. The investment in central location pays dividends in daily quality of life and long-term appreciation potential.
Zaidín represents excellent value for families seeking affordability without sacrificing access to amenities. This area offers more space for the money while maintaining reasonable access to central Granada's attractions and services.
Salobreña appeals strongly to international buyers seeking coastal living, offering good value for those who prioritize beach access and tourism potential. The €1,925 per square meter average price provides reasonable entry into the coastal market.
Norte district offers the best value for budget-conscious buyers at €1,392 per square meter, though buyers should expect slower appreciation and longer commutes to central amenities.
For personal use, prioritizing proximity to daily amenities, transportation links, and lifestyle preferences often justifies the premium for central or well-located suburban properties over pure cost considerations.
If buying to rent out, which areas and property types are expected to generate the best returns in the next few years?
Central Granada properties offer the strongest rental investment potential, benefiting from consistent demand from students, professionals, and short-term visitors.
Properties near the university and tourist hotspots generate the highest occupancy rates and can command premium rents. The combination of student housing demand and tourism creates year-round rental opportunities.
Modern apartments and well-renovated townhouses in central areas are expected to deliver the best long-term rental performance, as tenants increasingly expect contemporary amenities and move-in ready conditions.
Salobreña and coastal zones show strong potential for seasonal rental income, with high summer occupancy rates supporting premium seasonal rates. Mixed-use and new build developments near coastal areas are attracting investor interest.
Properties optimized for Airbnb and short-term rentals in premium locations can achieve significantly higher returns than traditional long-term rentals, though they require more active management and market expertise.
New builds across all areas are expected to outperform older properties in rental markets, as tenants gravitate toward modern amenities, energy efficiency, and lower maintenance requirements.
It's something we develop in our Nicaragua property pack.
If buying to resell later, which locations and price brackets in Granada have the highest appreciation potential?
Central Granada, particularly the Cathedral area, offers the highest appreciation potential for resale-focused buyers.
Traditional and colonial properties in the city center are especially attractive for buyers seeking boutique hotel conversions or premium rental properties. These properties benefit from Granada's historical significance and tourism appeal, supporting strong long-term appreciation.
Popular suburbs and new developments near key infrastructure or amenities represent good appreciation opportunities, particularly as the city expands and transport links improve. Areas with planned infrastructure development often see accelerated price growth.
Emerging gentrifying neighborhoods like Barrio Xalteva and Reparto San Juan offer exceptional value now with strong future upside potential. These areas are attracting young professionals and artists, driving gradual transformation and price appreciation.
Properties in the €150,000-€300,000 price range often show the strongest appreciation potential, as they remain accessible to a broad buyer pool while benefiting from overall market growth. This bracket captures both local upgraders and international buyers.
Coastal properties in established areas like Salobreña provide solid appreciation potential, particularly beachfront or sea-view properties that benefit from limited supply and international demand for coastal lifestyle investments.
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
Granada's property market presents compelling opportunities for both personal use and investment purposes, with strong fundamentals supporting continued growth.
The combination of low supply, international demand, and attractive yields makes Granada an interesting consideration for property buyers in the current market environment.
Sources
- Indomio - Granada Capital Market
- Indomio - Granada Province Market
- Spain Easy - Property Investment Guide
- Hola Properties - Granada Costa Tropical
- The Latin Investor - Granada Real Estate Trends
- AirROI - Granada Rental Report
- Hola Properties - July 2025 Market Report
- Hola Properties - January 2025 Market Report
- Spot Blue - Spain Real Estate Market 2025
- Zoark - Best Neighborhoods Granada