Since the COVID-19 pandemic, more money has been going into residential complexes across the world. But two countries stand out: Spain and Italy. According to a report by property experts JLL, investment in Spain’s housing sector has grown by 87% since 2020. In Italy, the rise is even higher, almost 120%. The global average increase is just 19%, so these numbers are impressive.

But this isn’t just about buying or selling traditional homes. What’s really growing is a part of the property market known as the ‘living’ sector, a term used by investors to describe new and flexible ways of living.

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What Does ‘Living’ Mean in Real Estate?

When experts refer to the ‘living’ sector, they’re talking about a broad range of residential property types beyond just traditional homes or flats, like:

• Rental apartment blocks
• Coliving spaces – private bedrooms with shared kitchens or living rooms
• Short-term rentals – housing for people who don’t want long contracts
• Student housing
• Retirement communities
• Affordable homes – for people on lower incomes

These living options are becoming more popular, especially among young people, students, digital nomads, and retirees who want more flexible or supported ways of living.

Spain Is a Hotspot for Foreign Investors

One big reason Spain is attracting attention is that most of the money is coming from abroad. In fact, about 70% of the investment in Spain’s living sector is from foreign investors. That puts Spain among the top countries in the world for international interest, just behind Ireland, Australia, Denmark, and Finland.

In 2024, investors put €630 million into shared and flexible living spaces in Spain alone, more than anywhere else in Europe.

Why Are Investors Choosing Spain?

Experts say Spain’s strong property market and growing demand for modern housing are key reasons. Many people are looking for easier, more flexible ways to live, and Spain’s cities and coastal areas are popular with locals and people moving from other countries.

Investors who’ve worked in other countries are now bringing their experience and money to Spain. This could help reduce the pressure on the housing market by creating more property options and new types of homes.

Housing Investment in 2025 Is Off to a Big Start

So far this year, Spain has already seen €740 million invested in housing, from January to March alone. That’s more than double the amount from the same time last year. In fact, 27% of all real estate investment in Spain this year has gone into housing.

But there’s still a long way to go. Over the past 10 years, only 5% of new housing in Spain has been built by large investment companies. That’s much lower than the 16% average in other parts of Europe, the Middle East, and Africa. Also, Spain still has one of the lowest levels of new housing among major European countries.

What’s Coming Next?

JLL expects the rise in housing investment to continue. They believe around $1.4 trillion will be invested worldwide in the living sector over the next five years. Here are four trends to watch:

1. Big deals are coming back – after a quiet period, more large property sales (over €100 million) are expected.
2. Property values are rising – as rental income improves, housing prices are starting to go up again.
3. More demand for shared and affordable homes – investment in shared living and affordable housing in Europe is expected to hit €4 billion in 2025.
4. Building new homes is getting harder – high construction costs and expensive loans are making it more difficult to start new housing projects. This could make the housing shortage worse.

Final Thoughts

The way people live is changing, and the housing market is changing with it. Spain and Italy are leading the way as investors put more money into new and flexible types of housing. This brings both opportunities and challenges, from helping to ease housing shortages to dealing with the rising cost of building.

One thing is clear: the demand for better, more flexible housing is growing fast, and Spain is right at the centre of this shift.

Main image: Shutterstock/Maxim Studio