End Year Report: Strong Results, Changing Conditions

A Solid Year Following Record Growth

The transition from one year to the next is always a moment to reflect on what has passed and to set expectations for what lies ahead.

After reaching a company record in 2024 — representing almost a 50% increase compared to both 2023 and 2022 — Casteels & Eriksson managed to broadly maintain that level throughout 2025. While this in itself is a solid result, our internal objective for the year was to build further on that momentum, with a targeted increase of approximately 25% in sales. That target was not achieved.

Two Very Different Halves

The year followed an unusual trajectory. During the first half of 2025, we were performing exceptionally strongly and were on track not only to surpass our 2024 record, but also to exceed our projected targets. In fact, more than 70% of our total annual sales were completed in the first six months of the year.

The second half of 2025, by contrast, was noticeably quieter, prompting a closer look at both our own performance and the wider market.

Deals Took Longer to Close

Our conclusion is that transactions in 2025 were materially harder to bring to completion than in previous years. The strong first half was largely driven by listings and buyer interest built up during 2024, while the second half revealed slower deal flow and longer decision-making.

This reflects a mild market slowdown after several very active years, alongside a shift toward a buyer’s market where pricing has become more critical.

Rental Investors Slowed Down

One area that was clearly affected was rental-focused apartment purchases. Legal changes to holiday rentals introduced in April 2025 created uncertainty for investors.

With both town halls and residential communities now able to influence rental licences, many buyers chose to wait for clearer rules. This hesitation reduced transaction volume in the second half of the year and was visible across the wider market.

How We Adjusted Our Approach

We expect this situation to settle gradually as more communities address short-term rentals through upcoming AGMs, providing clearer guidance for buyers.

In response, we adjusted how we advise investor clients, placing greater emphasis on early checks of community rules, existing licences and AGM history. Interest in aparthotel-style properties may also continue to grow, as previously highlighted.

Other Changes on the Horizon

Beyond holiday rentals, other regulatory changes are worth noting. One is the planned introduction of a real estate agency registry, which could help raise professional standards across the sector.

Another update affects the reduced transfer tax for professional buyers. While the 2% rate remains, it now comes with a €500,000 price cap and a shorter two-year resale window. These changes may limit activity in the renovation and resale market without necessarily improving affordability for end buyers.

Focus for 2026

The Costa del Sol market remains supported by international demand, lifestyle relocations and limited housing supply. At the same time, 2025 showed that results depend not only on market conditions, but on maintaining strong pipelines and adapting quickly to change.

In 2026, our focus will be on rebuilding forward momentum, strengthening partnerships, and continuing to guide both lifestyle buyers and investors with clear, practical advice in a more regulated and slower-moving market.

Founder & Sales Director

Tim Casteels