Real estate in Spain is a traditional object of interest for foreign citizens as European and American pensioners are looking for cosy inexpensive housing to relax in a warm climate. Students from all over the world are interested in the simple program for obtaining a residence permit on a student visa. Investors in luxury real estate have also been stimulating Spanish housing construction for many years by investing in houses and villas in Spain. The latter category of buyers in Spain is not that great, but many cities and localities of this Mediterranean country owe their success to it.
Content:
Sought-after locations
Over the past few years, the Spanish luxury real estate market has suffered from two different trends, one of the reasons being the coronavirus epidemic. On the one hand, the quarantine measures, and the cross-border difficulties shifted the housing market towards domestic consumption. On the other hand, the same quarantine prompted buyers to change their preferences. If earlier real estate agencies had numerous offers for apartments in Spain, in the last 2-3 years, buyers have become much more interested in townhouses, villas and houses in rural areas. Islands and coastal areas have also become more popular than before – fresh sea air as a healing and preventive remedy is now in demand more than ever. Of course, these trends have also affected the supply, contributing to an increased value in the coastal regions.
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Costa Brava is one of the most popular areas for buying luxury real estate. It’s located in the province of Girona and is a coastal strip with numerous cities and settlements. This section of the northern coast of Spain, on the border with France, has a developed transport network, numerous attractions, and a picturesque seashore. The climate here is mild and more suitable for those who do not like the summer Mediterranean heat. Sandy beaches in the south of the region are replaced by majestic cliffs to the north of the coast.
The cost of real estate depends on the location – e.g., a 300 m2 two-storey house in the small municipality of Palamos, with 6 bedrooms and bathrooms, costs €1,750,000. The price is influenced by the exceptionally large size of the plot – over 4 hectares – and its close location to the Marina de Palamos and the city beaches.
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The Costa Dorada is located to the south. Its sandy beaches attract numerous tourists every year. It has a perfectly balanced warm Mediterranean climate, with mild winters and not ridiculously hot summers. Buying a property in this region can be a successful investment when renting to holidaymakers as the holiday season lasts at least six months.
Luxury real estate in the region is located unevenly – e.g., there are few new villas in the ancient city of Tarragona, and these options are at the project stage. An off-plan 535 m2 three-storey premium house in the suburbs, with 5 bedrooms and bathrooms, can cost about €2 million. The terrace will have a magnificent sea view, and the most modern materials and technologies will provide the building with the necessary energy efficiency, important for real estate in development projects in Spain. The villa is ideal for history lovers – as the first Roman settlement in the region, Tarragona is filled with a lot of historical attractions.
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The Costa del Sol region is located in the south of Spain and is considered a centre of attraction for very wealthy people and celebrities. Due to the proximity to the Atlantic Ocean, the sea here is not too warm, but this does not stop buyers of luxury real estate – the best service in all of Spain will leave few people indifferent. In addition, you can swim in your pool, which is part of any premium villa. The excellent ecological situation developed transport infrastructure and entertainment for every taste – attracting people to live in the Costa del Sol or at least go back there repeatedly.
The popular resort of Estepona is small and is actively being built up with elite real estate. The newly commissioned villas are next to the popular Resina Golf Club. A 6-bedroom house of 860 m2 (of which 470 m2 is residential) is for sale for €3,200,000. Of course, there is a private pool, a cosy garden and a spacious roof terrace. The price is due to the panoramic view from the top of the hill of the sea and the surrounding area, proximity to the prestigious golf club and the premium atmosphere of this area. This house is also well-suited for renting as numerous holidaymakers visit Estepona all year round.
Market features and important details
This year, the tax calculation type on acquired secondary real estate in Spain changed. Now not only the real estate selling value will be important, but the cadastral value as well– and the tax will be paid from the larger one. As the cadastral value is difficult to calculate, there is a possibility of a significant increase in this tax in some cases. The easiest way to avoid such a development is to buy apartments in development projects in Spain, which are not covered by this tax.
The cadastral value of real estate is also important if tax is paid on imputed income from real estate. Every property owner who is a non-resident or has lived in Spain for less than 6 months for each past year pays this tax. As a result, the amount of income can be up to 0.5% of the cadastral value per year, which in addition to all other expenses can be a significant amount for owners of premium villas. Of course, Spain’s residents are spared from these payments.
Off-plan projects in Spain are also beneficial to foreign buyers as they are rented out and ready for accommodation. New modern plumbing, a fully equipped kitchen and the latest energy-saving standards make the owner's life easier and saves money. Secondary housing needs at least cosmetic or even general repairs before the new owner can take residence. Moreover, the new apartments consider the modern mentality, and their spacious rooms are far more suitable for a buyer from Europe or Russia than the small bedrooms of Spanish houses and apartments.
