The answer is simply yes. Not just one, many foreign people want to buy a second investment property for sale in Spain, especially those who travel there frequently and have favorite locations near golf courses, along the seaside, or on mountain slopes with panoramic city views.
There is no denying that Spain is an amazing destination for holidays and permanent living. It has a lot to offer, including the Mediterranean way of life, free outdoor living, nearly year-round sunshine, breathtaking scenery, reasonable property and living costs, and much more.
These claims are further supported by sales data from the previous two years. In 2022, there were approximately 600,000 foreign direct investments in Spain. There was a slight slowdown in the market in 2023, but it was still marginally below the number recorded in 2022.
Spain’s real estate market has retained value despite a decrease in sales. On the contrary, many regions have witnessed increases at least in line with inflation.
The most recent monthly report from Tinsa’s property index shows that Spanish home prices increased by 4.3% in the year to October. The yearly growth rate of real estate in the Canary Islands and Balearic Islands was 7.7%. The price increases were 15% in Alicante and Palma, 14% in Valencia, and 13% in Malaga.
Prices are expected to rise more in 2024 due to active demand and an increased number of households. 2024 can be a good time to invest in property in Spain if you have such a plan before prices increase even more.
Is it safe to invest in Spain?
Buying investment property in Spain is safe for everyone. That’s why it is one of the most preferred investments in the European market. A strong legal system, a constant commitment to free trade, and a history of political stability back the Spanish real estate market and businesses.
Businesses and investors feel secure about their investments because of the flexible and diverse economy, which acts as an insurance policy against future economic instability. This stability creates investor trust and a favorable atmosphere for the development and expansion of further businesses.
To open a parenthesis, Spain is a safe and welcoming country for real estate buyers, but there are scam efforts here, as there are everywhere else. Therefore, working with a real estate company that is knowledgeable about the procedure, has closed deals before, and most importantly, will offer you legal help is crucial.
With a focus on success and trust, Tekce Exclusive supports you during the whole buying process and ensures that all of your transactions are carried out with the assistance of lawyers in an environment that protects your legal rights. You can see the most promising Tekce Exclusive projects here.
What are the benefits of investing in Spain?
Among the first that spring to mind are the stable Spanish economy, well-developed infrastructure, a promising and reasonably priced real estate market, and easy access to the EU.
Additionally, non-EU nationals can obtain a Spain residency through an investment program called Golden Visa. You get the right to live and work in the country by investing a particular amount— for example, €500,000 in real estate by 2023. After 10 years, Spain’s citizenship by investment is even possible. Of course, you can visit any country in Europe as well.
Tourism is already one of the most important resources in Spain. Thanks to the region’s year-round sunshine, you can spend your vacation in the world’s best vacation destination in the comfort of your own home or you can purchase a summer home and rent it out to visitors to generate additional money.
Last but not least, Spain’s culture, cuisine, location, and outdoor lifestyle excellence have proven to be popular and well-liked by all. Millions of people visit Spain each year to experience the whole atmosphere.
What are the challenges of investing in Spain?
Firstly, the language barrier is the first issue that investors deal with. Speaking Spanish is necessary while doing official business, even though English is widely spoken in daily life. Writing abilities are also required, as all documents will be translated into the local language.
Then, when managing your transactions, purchasing a home, or launching a business, there is a certain amount of bureaucracy involved. The entire process, including negotiating with sellers, signing contracts, and even turning on the electricity, must be known well.
There could occasionally be issues with legal considerations. You must be careful and ensure that your rights are completely protected in a foreign country as well.
Sadly, none of these allow a foreign investor to have the comfort to experience the thrill of beginning a new life or adventure. Undoubtedly, it is critical to work together with a company that is familiar with the entire procedure, including the legal aspects, speaks both the investor’s language and the local language, and understands the investor’s goals. You can comfortably finish your process and feel safe doing so.
Where are the best places to invest in property in Spain?
Your demands and preferences will determine the ideal location to call home in Spain. However, generally speaking, the east and south of Spain are becoming more well-liked these days.
Malaga, Alicante, and the whole Costa Blanca and Costa del Sol regions, in particular, are regarded as some of the best places in Spain to live in nowadays. Also, considering the increase in real estate values discussed in the first section, Alicante and Malaga can be some of the best places to invest in Spain.
There are numerous small and major towns in the mentioned cities. In particular, Altea, located in Alicante, is becoming well-known. The town is full of life and there are a thousand things you can do, from taking advantage of the many cultural activities, such as concerts, and exhibitions, to doing water sports, such as sailing, snorkeling, diving, etc.
In all these regions, investors can find a wide range of luxury, affordable, and modern properties, with magnificent sea views from their balconies. The regions promise a comfortable as well as a metropolitan lifestyle for all tastes. There are also numerous educational and employment options nearby.
What type of property should I invest in?
As it might be simpler to generate income regularly, residential real estate for sale in Spain is always a secure choice for both experienced and beginner investors. There are many investing tactics to use, and each market has a different level of competition.
What works for one investor might not work for another. Therefore, when it comes to residential real estate, picking the appropriate exit plan and market is crucial.
Commercial properties in Spain also offer a noteworthy potential for income, longer lease terms, and lower vacancy rates. Many sectors, particularly tourism, are open to new business investments. Spain can be an excellent option for your company to enter the European market.
What are the costs associated with buying property in Spain?
The price of purchasing real estate in Spain varies slightly according to whether you want to buy new or secondhand. Property type, location, purchase price, terms of payment, and other factors also range. But, the costs are typically between 11 and 14% of the purchase price.
In the process, buyers must pay VAT, stamp duty, notary fees, land registry fees, legal fees, etc. In addition to these expenses, there will be additional mortgage costs if a housing loan is used. The notary expenses are also increased by the mortgage.
How can I finance my property purchase in Spain?
You can obtain a mortgage to purchase a property in Spain even if you are not a Spanish citizen or resident. However, the Spanish banks may have additional requirements for non-residents.
Additional paperwork is required, including tax records, employment agreements, and proof of income. In addition, you must provide proof of regular income and put a minimum deposit of 20 – 30% of the total property price.
As a non-resident of Spain, you can get a mortgage for 70% of the purchase price. Residents can qualify for financing of up to 80%. The maximum loan term is usually between 20 and 25 years.
Real estate developers also provide installment payment options, especially for off-plan properties in Spain. After making a down payment, you can make monthly payments.
How can I manage my property in Spain?
If the property will be empty for a long time or you have more than one property, it would be better to work with a property management company. These companies are helpful because you have a lot to deal with, from legal issues to painting the property, and they do it all for you.
For example, it is not legal to rent out a property in Spain without a tourism license. It does not matter if you plan to rent for a few weeks or several months every year. You can get the license after meeting many requirements.
Spanish property management companies usually help to get a tourism license on your behalf. They let you know if your Spanish property meets the requirements or if any changes are necessary to get the license.
Additionally, many offer marketing the property, managing reviews, guest communication, organizing cleaning and maintenance, insurance, pricing and fees, etc. Upon request, Tekce Exclusive recommends the best property management companies in Spain to customers.
If you would like to get more information about how to invest in real estate in Spain and current hot deals in the market, you can always contact Tekce Exclusive consultants.
