In 27 Spanish provinces, smaller municipalities show higher relative rental demand than the respective provincial capital. In Málaga, Vélez-Málaga is moving into the spotlight – while rents there are rising significantly.
Spain Expat Press Editorial Team
by Marlon Gallego Bosbach
Spain’s tight housing market is increasingly changing the way people search for rental accommodation. As housing in major cities becomes increasingly unaffordable for many, demand is shifting towards smaller towns and communities in the surrounding areas. A recent analysis by the real estate portal Idealista shows that this trend can now be observed in numerous provinces across the country.
This trend is also evident on the Costa del Sol, with Vélez-Málaga emerging as a particular focal point. According to the analysis, this town in the Axarquía region – located approximately 35 kilometers east of Málaga – shows exceptionally high relative demand for rentals. At the same time, asking rents there are rising significantly faster than in the provincial capital.
Smaller towns are becoming increasingly important in the search for housing
According to data analyzed by Idealista, in 27 of Spain’s 50 provinces, at least one smaller municipality ranks ahead of the respective provincial capital in terms of relative rental demand.
This trend therefore affects more than just major metropolitan areas. Competition for available housing is intensifying outside the well-known metropolises as well. Those looking for housing are increasingly turning to locations that offer lower rents compared to the major cities.
It is important to note that relative demand describes the ratio between the number of interested parties and the available supply. It does not automatically mean that there is a higher overall demand for housing in a smaller municipality than in the provincial capital.
Vélez-Málaga: Cheaper than Málaga, but with a sharp rise in rents
In the province of Málaga, Vélez-Málaga is a particular focus. While advertised rents in the city of Málaga averaged €16.50 per square meter per month in August 2026 – according to data cited in the report – the figure for Vélez-Málaga was around €11.20.
As a result, rent levels in Vélez-Málaga remain lower than in the provincial capital. This gap could be a key factor for apartment hunters unable to find affordable housing in Málaga. However, rents in the smaller town are rising much more sharply; an annual increase of 15.2 percent is reported for Vélez-Málaga, whereas the rise in the city of Málaga was 2.8 percent over the same period.
The figures show that rental pressure does not simply vanish when apartment seekers turn to smaller towns. Rising demand can drive up price levels there as well.
A nationwide trend – from Madrid to Alicante
According to Idealista, a shift in rental demand is evident in several regions of Spain. Smaller towns and municipalities in the areas surrounding Madrid and Barcelona are also gaining importance; examples cited include Getafe near Madrid and Cornellà de Llobregat near Barcelona. In the province of Alicante, Alcoy is attracting attention: the report notes that asking rents there stood at 8.40 euros per square meter, whereas the city of Alicante was significantly higher at 13.90 euros.
The examples illustrate that the search for housing is increasingly extending beyond the boundaries of major cities. However, the extent to which this trend affects individual municipalities also depends on how many apartments are actually available there for long-term rental.
Long-term rental housing remains scarce
In addition to demand, available supply plays a central role. According to data analyzed by Idealista, the number of apartments offered for long-term rent fell by 0.2 percent in the second quarter of 2026 compared to the same period the previous year. At the same time, the supply of seasonal rentals increased by 13 percent. Consequently, seasonal rentals already accounted for 29 percent of the total rental supply in Spain.
This development is relevant for those seeking housing who require permanent accommodation. Seasonal contracts are generally intended for a temporary stay and do not automatically offer a long-term housing solution.
However, the figures alone do not prove that all seasonal rental contracts are used to circumvent tenancy laws. The decisive factors are the actual purpose of the contract and the specific terms and conditions in each case.
Housing pressure is increasingly extending beyond major cities
The latest analysis shows that the strained situation in the Spanish rental market is not limited to Madrid, Barcelona, or Málaga. Smaller cities are also increasingly attracting the attention of those looking for housing.
Vélez-Málaga serves as a concrete example within the province of Málaga: while the city continues to offer lower asking rents than Málaga, it is simultaneously experiencing a sharp rise in prices and high relative demand.
This increasingly raises the question of how sufficient, affordable, and long-term available housing can be created and maintained—not only in major cities but also in their surrounding areas and smaller municipalities.
