In the current UK economic climate, few investments offer the potential of high returns with low risk. In many areas of the UK, the property market prices are too high for investors to make the returns that they could have done 5 years ago. Property capital growth rates in investment properties on the costa del sol, Almeria, Cartama, Cordoba, Costa Blanca and Costa Blana North have shown an increase of between 15%-25% over the last 4 years. Estimated growth is predicted to continue at this level for the next 4-5 years. Prices in these areas are increasing rapidly, but many areas are still reasonable compared to other parts of Spain. Last year over 100,000 British decided to buy investment properties costa del sol.
Be it a Spanish villa or an apartment, Rural Estates carefully selects projects based on the following criteria; Constructional quality, design, location, access, rental potential, future area development and infrastructure and of course value for money. Many of our clients, who want to buy investment properties costa del sol, come from recommendations - so it is in our best interests to offer our best advice.
New Construction
When buying a new build Spanish villa or an apartment, you have the opportunity to reserve your property at up to 30% below market value. These investment properties costa del sol are offered initially at such a low price is to attract individuals who are in no hurry to take occupation but realise the significant savings of early purchasing. By the time your Spanish villa or an apartment is ready to move into it will already be worth considerably more than the initial investment. If you are looking to buy investment properties costa del sol purely as an investment, the longer the build time the higher the capital growth on the property will be.
Working Example
2 bed unit priced at 120,000 euroAmount paid during 12 months construction - 24,000 euros (20%)
Property value increase during 12 months construction period - 24,000 euros (20%)
This increase amounts to 100% of the original on investment properties costa del sol but costs such as legal fees, etc must be taken into account and the property will need to be sold at slightly below market value to encourage a quicker resale.
Therefore a profit margin of 80% on original investment is suggested. Should you wish to sell the investment properties costa del sol during the construction period, you simply call us to arrange this, and we will do the rest.
If you were to complete your purchase on the above working example - you would be realising a profit of 24,000 euros the day you move into your new property.If you have decided to buy investment properties costa del sol as a holiday home or permanent residence, we will assist you in getting a low rate mortgage for the remaining balance at the end of construction.
How much money will I need to start on investment properties costa del sol?
You will need to have access to £20,000 depending on the price of the property you are reserving. This will include legal and processing fees, stamp duty, title and land registry searches, the Spanish VAT (IVA) and legal fees. Rural Estates will shortly be offering investors the opportunity to buy a Spanish villa or an apartment in Spain from £10,000 - investments at this level are rare, so please register if interested.
When you reserve an investment properties costa del sol, a reservation fee of 3505€ or £2500 is required and this amount is then credited against your equity with the balance of 20%-30% (depending on development) of purchase price due within 30 to 45 days. Balance of money is due on completion of project.
Rental investment properties costa del sol.
Below are the figures produced by us in conjunction with two major Spanish villa rental companies based in the inlnad andalucia areas. These prices are intended as a guide to the level of income achievable in the 2003/2004 season from a two bedroom apartment, a three bedroom villa with a communal pool and a larger three bedroom villa with a private pool.
These figures are based on the first years return and include the capital growth of the property. We have based this figure on your property increasing in value in year one, by 10%. We believe this figure to be conservative, as in the past five years many properties have doubled in value, and still remain much cheaper than other parts of Spain.
You should also bear in mind that over a period of years some general maintenance will need to be figured into your profitability.
Properties in the Costa Blanca area are still under half the price of property in the major European towns. With many investment properties buyers and holiday makers from the UK, Norway, Denmark, Sweden, Finland and other EEC member states, you can be assured that your property will be in demand in the future.
