Article Index
Spanish Land Grab Law Explained
Getting Around The Costa Blanca
Spanish Health And Living Costs
Education Arts And Culture In Spain
Buying Property In Spain
Spanish Property Mortgages
Should I Learn Spanish?
Spanish Property Investment
|
Buying off-plan, and with a rising Spanish property market, now could be an excellent time to think about investing in a Spanish property. We take you through the basics.
The Best Types Of Spanish Property For Investments
If you are looking to buy a property to rent out to holiday makers, it might be best to consider a property near to the airport, with two bedrooms and two bathrooms. An apartment with private community garden and pool area might be ideal, although of course there are no fixed rules.
Ideally, your Spanish property investment might have good access to beaches, or golf courses, restaurants and night life. This will all help in attracting tenants to your Spanish property and keep good occupation rates.
Spanish Property Off-Plan Or Spanish Property Resale?
Investing in a Spanish property off-plan has become popular in recent years, mainly due to the growing market for new developments. When a construction is first started, many plots or units are sold by contract before the property has been fully completed. This ensures paying for your Spanish property at the lowest price. A typical Spanish property development is released in phases. At the beginning, the property is sold at the lowest price before rising to a value equal to that of the final unit sold, when the development is closer to full completion.
Because the development is now visible with infrastructure such as swimming pool, parking, trees and of course the building itself, the value of the property often rises. In this way, an investor can make money by the investment in a development during the first phase or closest to the beginning of the development as possible.
Typically it might take 18-24 months for a property to reach completion from the time of signing contracts. All property contracts should be handled by your Spanish Lawyer.
Spanish Property Resales
A resale Spanish property has the obvious advantage that it is already built; you can see the bricks and mortar for yourself, however in contrast to off-plan investments, its potential for appreciation may be less. However, with many Spanish property resales being sold full or part furnished, a great advantage is that you can obtain rental income straight away without the wait experienced through investing off-plan. With the demand for Spanish property continuing to rise, the potential for natural appreciation in value may be set to continue.
Security For Your Spanish Property Investment
You should always seek to use a qualified English speaking Spanish lawyer to handle your investment contracts and other legal considerations.
Spanish Property Rental Income
In order to make a return on investment, you must make sure that the rental income must exceed the amount you pay on repaying your mortgage.
This can depend on:
(a) Amount borrowed to purchase property.
(b) Interest rates charged on borrowed amount.
(c) Vacancy rate (i.e. how often the property is being rented).
By paying for the Spanish property mortage from rental income, you are also building an asset that you can sell, and that can increase in value with the market.
Bear in mind that the increase in the value of the property will not become part of the original amount borrowed, and thus you can make money from your borrowing provided you make sufficient rental income. This is sometimes referred to as 'gearing'.
Bear in mind you should always seek professional investment advice before making any decisions to invest in a Spanish property.
Spanish Property Financing
Please see our Spanish Property Mortgages feature for information about financing your investment. |
Articles & Information
