Property Market Overview

Gibraltar Property Market: Recent Trends and Adjustments

Between November 2020 and May 2022, Gibraltar’s property market saw remarkable, but clearly unsustainable growth, with average prices rising by 50% to 70%. This surge was driven by factors such as low interest rates and increased demand for residency. However, the rapid escalation proved unsustainable, leading to a slowdown in the latter half of 2022.

Global challenges, not least of which were increased interest rates and global economic uncertainty, contributed to the slowdown. The promise of new, off-plan property and an increase in housing also added to the deceleration. By 2023, the market began to cool down, with prices settling, and in some cases dropping. However, in prime locations and new luxury developments, prices stabilized at the high end—up to £11,000 per sq. m.

Since the beginning of last year, the slowdown has become apparent.

The number of properties for sale and/or rent has increased significantly, and even the casual observer has become aware that this is a buyer’s market. The influx of off-plan properties to the market has added to the slow uptake on investment properties, and the reduction in the rental market has underpinned this hesitancy among investors. This has provided better options for potential homeowners and a softening of values of between 5% and 10%.

However, most of the new developments have been sold out within a very short period of coming available. Historically, the oversupply created by new developments has always evaporated relatively quickly, and the high level of investor confidence shown by the developers clearly underpins the stability and resilience of the Gibraltar property market, where supply has rarely exceeded demand for any length of time.