A report from the Bank of Spain estimates a €1,327 loss in the value of a house in Madrid for every 10% increase in NO2 emissions. Each extra day above 35 degrees reduces the sale price by 0.08%, according to Complutense University.
The price of housing in Madrid is already reflecting the effects of pollution and extreme heat. According to a report from the Bank of Spain, a 10% increase in nitrogen dioxide (NO2) emissions reduces property values in the capital by 0.65%, which equates to about €1,327 lost per home. The information, reported by elDiario.es, is based on a study analysing 106,449 transactions from the Property Registry between 2014 and 2020 and data from the 20 pollution measurement stations in the city.
The work, authored by researcher Marina Gómez-García, confirms that pollution not only lowers house prices but also reduces the number of sales. The impact is greater in higher-income neighbourhoods: while in the 25% lowest-income areas a 10% increase in pollution reduces prices by 0.47%, in high-income neighbourhoods that effect doubles to 0.91%. A similar trend is observed with educational levels, where the drop goes from 0.43% in areas with lower education to 0.95% in those with higher qualifications.
Heat also affects the market. Research from Complutense University of Madrid, University College Dublin, and University of Barcelona concludes that each additional day above 35 degrees compared to the previous year moderates sale prices by 0.08% and rental prices by 0.15%. The authors of the study, Adrián Fernández Pérez, Marta Gómez Puig, and Simón Sosvilla Rivero, analysed prices in 47 provinces between 2009 and 2024.
The improvement in air quality in Madrid between 2019 and 2023, when pollution fell by 23.1%, would have driven price increases of 1.5% in the last three months, 2.3% in six months, and 2.9% in nine months. With an average price of €204,197, these increases represent €3,062, €4,697, and €5,922, respectively.
The impact of pollution on prices is greater in higher-income neighbourhoods, with more children, higher educational levels, and lower populations
The document from the Bank of Spain is the first to scientifically quantify this effect in Madrid and continues previous studies in Tehran and the United States. Pollution is associated with up to 22,000 annual deaths in Spain, according to a Lancet report from 2025, and 2,200 in the metropolitan area of Madrid, according to ISGlobal.
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