Market Overview

The Mercado district in Alicante currently exhibits a balanced purchase market with 152 active listings and a median price of €328,000. The average price stands at €352,133, with properties ranging from €135,000 to €1,450,000, indicating a broad spectrum catering to both mid-market and premium buyers. The average property size is approximately 129 sqm, with an average of 3.3 rooms and 1.95 bathrooms, suggesting a predominance of family-sized apartments. Inventory is well-diversified: 6 studio/1BR, 28 two-bedroom, 57 three-bedroom, and 58 four-plus-bedroom units. The average price per sqm is €2,980, which is competitive for central Alicante. Amenities are strong, with 84.9% of listings offering air conditioning and 36.2% including parking. The yield profile is moderate, with desirable properties comprising 34.9% of the market, and a relatively high turnover as evidenced by 160 delisted properties over the period. Investors should expect gross yields in the 4–5% range for well-located, mid-market units, with higher yields possible for value-add or short-term rental strategies.

Investment Thesis

Mercado is best suited for long-term buy-and-hold investors seeking stable capital appreciation and moderate rental yields, given the area's central location, strong amenity base, and consistent demand from both local and international tenants. Holiday rentals can outperform in select, well-renovated units near transport and amenities, but regulatory risk and seasonality should be factored in. Flipping is less attractive due to the relatively efficient pricing and limited supply of distressed assets. Focus on spacious 3–4 bedroom apartments in the €275,000–€400,000 range for optimal liquidity and rental demand.

Investor Shortlist