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The latest report from the Housing Observatory Chair at the Universitat Politècnica de València, corresponding to the third quarter of 2025, once again reveals an alarming fact: the average price of new housing has more than doubled since 2019 in the city of Valencia and its metropolitan area. The average sale price now exceeds €3,700/m² in the capital and reaches more than €4,500/m² in places such as Godella, Almassera, or El Puig. "The consequence is clear: a market that is growing in terms of figures, but is empty of accessibility", warns Fernando Cos-Gayón López, director of the Chair.

The report points out that the effective offer of new-build properties has fallen by more than 80 % in six years. Eight districts of the city have no active developments, and the few that do exist are aimed at high-income buyers or international investors. Salaries, on the other hand, have increased by only 10% since 2019. Today, the average effort required to buy a home exceeds 45 % of the net income of a typical household, far above the accessibility threshold recommended by the European Union, which stands at 30%".

"The market is statistically visible, but socially invisible", explains Cos-Gayón. "Working families are the big absentees of the new property cycle", he adds.

Valencia, with a year-on-year increase of 17.1%, leads the rise in rents in Spain in 2025

Pressure is also very present in the rental market. In fact, Valencia leads the rise in rents in Spain in 2025, with a year-on-year increase of 17.1%. The average monthly price reaches €1,674, making renting an unviable option for a large part of the working and young population. '35 % of contracts signed are now temporary or short-term, while long-term rentals are declining due to legal uncertainty and the withdrawal of supply following the Housing Law 12/2023,' Cos-Gayón points out.

In addition, the director of the Chair adds that this situation ‘chronically uproots the urban population: young people who delay their emancipation, families displaced to the suburbs and essential workers who can no longer live in the city where they work’.

Population growth aggravates the pressure

On 1 January 2025, Spain reached a total population of 49.08 million, exceeding the 49 million mark for the first time. Annual growth in 2024 exceeded 458,000 people, due entirely to positive net migration. In this regard, the Valencian Community has been one of the most dynamic regions, with its population growing by 5.5% since 2022. Notably, 84% of this increase is attributed to the foreign population, according to data referenced in the report. This growth, although positive, according to the Observatory, 'aggravates the pressure on an already insufficient housing stock, without a coordinated strategy between administrations’.

In this context, the report identifies construction costs as a 'decisive obstacle. Materials, energy and labour have made building so expensive that it is unviable in many cases. Job vacancies in the sector have quadrupled in the last decade, and business fragmentation prevents large public or private developments from being undertaken.

‘Continuing to build using traditional methods is unsustainable,’ says Cos-Gayón. ‘The sector needs to industrialise in order to regain scale, reduce costs and return to producing housing at a rate in line with real demand,’ he says.

Industrialised construction as a solution

‘Industrialised construction,’ according to the Chair, "makes it possible to reduce construction times, stabilise costs and guarantee quality. The historical example of the first UPV building, designed by Joaquín Hernández and built in just 12 months between 1969 and 1970 using a fully prefabricated system, shows that speed and durability can coexist. Fifty-five years later, the building is still in use, reminding us that technical vision and industrial planning are compatible with permanence and excellence," they say.

The report concludes that Spain needs to redefine its housing policy. 'So-called viable affordable housing must be decent, sustainable and replicable, but also economically feasible. It is not a question of competing with free-market housing. Still, offering homes to those who are currently excluded from the market,' it states.

‘The data is not a destination, but a map,’ concludes Cos-Gayón. ‘And the map for 2025 points to a clear course: industrialise to build more, redefine affordable housing and restore cities to their essential function: to be places of welcome, not expulsion,’ concludes the professor.