Buying to let on the Costa del Sol still works in 2026 — but the rules and the returns have both moved. Here's our honest, current picture.
We manage holiday rentals and sell investment property, which gives us a front-row seat to both sides of the invest-to-rent equation. Halfway through 2026, here is what we'd tell a friend thinking of buying on the Costa del Sol to let it out.
The returns, without the sales gloss
According to idealista's second-quarter 2026 figures, the gross yield on buying a home to let in Málaga city is around 5.2% — comfortably ahead of bank deposits and government bonds. And that's only half the return: Málaga city prices have risen roughly 10% in the past year, so a well-chosen property has been paying its owner twice, in rent and in value. Few markets in Spain combine both as reliably as this coast.
Holiday letting can outperform those long-term figures in strong locations — Fuengirola's front line in August is a different business from a suburban flat on a twelve-month contract — but it comes with seasonality, management effort and, crucially, regulation. A realistic model uses net yield: knock off community fees, IBI, insurance, management, void weeks and tax before comparing anything to a bond.
The regulatory year in one paragraph
2026 has been eventful. In May, Spain's Supreme Court annulled the national short-term rental registration scheme created by Royal Decree 1312/2024, ruling that the state had overstepped regional competences — so the single national registration number is gone for now, though the digital one-stop window and platform data-sharing obligations remain. What did not change is the layer that actually governs you here: Andalusia's own rules (Decree 28/2016, updated by Decree 31/2024) still require holiday homes to be registered with the Andalusian Tourism Registry and to meet habitability and equipment standards — and town halls increasingly add their own zoning conditions. In short: the paperwork is regional, it is real, and it should be checked before you buy, not after.
We'd add one practical warning from experience: not every apartment building or urbanisation permits tourist letting, and community rules can change. Legal due diligence on this specific point is the best few hundred euros an investor can spend.
What actually makes money here
After years of managing rentals, our shortlist of what separates the strong performers:
- Walk-to-everything locations — beach, train, restaurants. Guests pay for convenience, and repeat guests pay twice.
- Year-round appeal. Fuengirola and Benalmádena rent in February to golfers and winter escapers; purely summer resorts don't.
- Air conditioning, decent Wi-Fi and outdoor space — the three things every listing filter selects for.
- Realistic pricing in shoulder seasons beats chasing peak rates and sitting empty in November.
Buy the numbers, not the dream
If the sums work at honest occupancy and net yield, the Costa del Sol remains a market with deep, resilient demand — our own booking calendars this summer say as much. Browse current opportunities on our sales page, from Fuengirola apartments to new developments designed with rental in mind, and see the rental side of our business in action in the rental search.
Better still, ask us for real numbers: we can show you what comparable apartments actually earn across a year, not what a brochure hopes. That conversation costs nothing and has saved more than one client from a pretty but unlettable purchase.
The GR Estates Team
The best experiences on the Costa del Sol
Written with AI assistance and reviewed by the GR Estates team before publication. AI transparency
