Answers for property owners
What Happens When You Overprice a Property? How to Lose Value Even When the Market Rises
Many owners in Marbella and Benahavís think future price rises will make up for a high price. The reality is different.
SHORT ANSWER
If your home does not generate rental income, waiting has a cost: around 1.5% a year in upkeep, 2% inflation and 1% ageing take roughly 4.5% off every year. Overpricing does not protect value, it usually reduces it. The right price is the one that protects what you actually take home.
IN THIS ARTICLE
The figures are indicative estimates, but the logic is sound. What counts is what you walk away with at the end, not the price you put on at the start.
The four factors working at the same time
When a property comes to market above its real value, these factors are all at work at once:
Market growth
Yes, prices tend to rise over time. It is the usual argument for overpricing, but it is only one variable, and not the most decisive one.
Upkeep costs
Owning a property means constant expenses whether you sell or not: community fees, insurance, IBI (property tax) and small repairs. A reasonable estimate is around 1.5% a year.
Inflation
Even if you get a higher price in the future, the real value of that money may be lower. For the calculations we assume 2% a year.
Ageing of the property
Homes lose appeal over time: trends change, newer products appear and a house can start to look dated. A reasonable benchmark is around 1% a year.
The sum almost nobody does
Added together, the three take roughly 4.5% off every year. For waiting to pay off, the market would have to rise by more than that each year just to leave you where you started. And in the meantime, a home that has been on the market for months loses strength in negotiation.
The right price is not the highest one you can imagine, but the one that protects what you actually take home.
Alfonso Lacruz
What to do instead
- Ask for a comparative market analysis based on completed sales
- Find out what determines the value of a villa
- Set a price that brings offers in the first few weeks
- A good agent helps you fine-tune the price with data
The figures of 1.5%, 2% and 1% are indicative estimates for the calculation, not data from a specific home.
Frequently asked questions
Is it worth waiting if the market is rising?
Only if the rise outweighs the cost of waiting. Upkeep costs, inflation and ageing take around 4.5% off every year.
Can I start high and come down later?
You can, but a home that has been on the market for a while loses negotiating strength: buyers always ask how long it has been for sale.
How do I know what the right price is?
By comparing your home with those that have sold, those that are for sale and those that are not selling.
What if I am in no rush to sell?
Then it is better to take the home off the market before it goes stale than to hold on to a price that does not generate offers.
About the author
Alfonso Lacruz
Naval engineer and market analyst. Over 25 years advising owners in Marbella and Benahavís. Publishes a monthly market analysis with Land Registry data.
Every case is different: before you sign or decide, confirm your situation with your own lawyer, notary or tax adviser.
Sources: Own estimates by Alfonso Lacruz Team | KW; Land Registry. Last updated: 24 October 2026.
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