What is better not to save on by choosing real estate in Spain

Are you thinking of buying a house in Spain for your holidays or looking to rent a property? Spain attracts thousands of people for its natural beauty and luxurious lifestyle. The country has a developed domestic market and is improving its mortgage potential. However, you need to consider the return rate when investing. The article deals with all the pros and cons of investing in property in Spain.

CONTENT:

• Buying property in Spain: pros and cons
• Cons of real estate investment in Spain
• Prospects for Spanish real estate market
• How to buy property in Spain as a foreigner
• Taxes
• Tips for buying property in Spain
• Best cities for investment in Spain
• Property in Spain

BUYING PROPERTY IN SPAIN: PROS AND CONS

1. Affordable mortgage rates (Spain has some of the lowest rates in all of Europe).
2. Affordable property prices and low taxes.
3. Large selection of modern property.
4. Tourist attractions and famous beaches.

If you want to spend time with family or friends on high quality level, Spain is the perfect place. As a tourist, you will find many stunning villas and houses for sale here.

Spain is known for its various luxury family entertainment centers such as water parks and boating canals.

1. Attractive projects for investors.

Spain has many attractive programs and investment packages to attract investors and visitors. In some areas of Spain, you can get tax breaks and investment benefits.

CONS OF REAL ESTATE INVESTMENT IN SPAIN

1. It is hard to find the time.

Various incentives such as tax exemptions and duty-free regions attract thousands of investors. However, you need to find the right time. Typically, property purchase prices in Spain are really high in summer and slightly low in winter.

1. High maintenance costs (when buying a secondary housing).

Analyzing the pros and cons of buying real estate in Spain, we highlight the prospects for the Spanish housing market.

PROSPECTS FOR SPANISH REAL ESTATE MARKET

Spanish housing market is attractive for many reasons.

Economic forces:

• Solvent economy, ranked thirteenth in the world according to the International Monetary Fund, and twenty-third in the World Economic Forum's Global Competitiveness Index.
• Spain is an important international innovation center within the European Union.
• Spanish society is very dynamic, with highly skilled young population.
• High return on investments.
• Affordable mortgage.
• Affordable housing prices.

Geographic factors:

• Favorable climate and beautiful nature.
• Spain connects the European, African, American and Asian continents by air, land and sea.
• Strong and constantly evolving infrastructure network.
• High quality of life.
• The country also has a rich historical and cultural heritage, a vibrant original culture, and a unique world-famous gastronomy. Therefore, many tourists and visiting foreigners stay here for permanent or temporary residence.
• Spain has the best Mediterranean climate in Europe, it is a country with some of the leading resorts in Europe and the world.

Thus, when asked whether it is worth buying an apartment in Spain, we answer - yes, because Spain is an excellent place for investment.

HOW TO BUY PROPERTY IN SPAIN AS A FOREIGNER

The purchase of real estate abroad is of interest to many investors. Thus, the British are the largest house buyers on Spanish land, followed by the French, Germans, Russians and Italians, and the number of Chinese citizens is also growing. Whether you are looking for coastal property or want to enjoy the diversity of major cities, it is imperative to have a clear understanding of the issues involved in buying a house.

The purchase of real estate by foreigners has a number of requirements.

Real estate acquisition by foreigners is accompanied by the only prerequisite - obtaining a NIE (foreigner identification number). This is a personal and unique number that is required for any transaction in the country, from starting a business to buying a house.

The purchase is made at a notary and is registered in the state register.

It should be borne in mind that before making a purchase with a notary, it is very common to enter into a private sales contract, called a “deposit agreement”.

TAXES

The conditions for real estate acquisition by foreigners require the payment of certain taxes and expenses.

Buying a house is subject to various taxes, which, on average, increase the price significantly. They include:

• Value Added Tax (VAT) in the case of new housing. The rate of the collateral is 10%.
• Tax on conveyances (ITP) in case of resale. The type of collateral ranges from 6 to 10% depending on the Autonomous Community where the property is located. It must be paid if VAT does not apply.
• Legal Acts Tax (AJD). It must be paid if the house has been purchased with a mortgage.

• Deed in the notary.
• Act registration in the Land Register.
• Mortgage expenses.

Other taxes will also be levied throughout the year, such as real estate tax (IBI), personal income tax or, if you do not reside permanently in Spanish territory, non-resident income tax.

TIPS FOR BUYING PROPERTY IN SPAIN

• Visit the property in person before paying, i.e. check first-hand the condition of the property, surroundings, transport routes connecting the area, etc.
• Find out who owns the house. You must go to the land registry and check its legal and city status. This avoids real estate scams.
• After purchase, register the house with the Land Register to prove absolute rights.
• If the deposit agreement was concluded before the notary, contact an expert who checks the content of the agreement and its consequences.

What is return on investment in real estate you can get in Spain? Return on investment in Spain can be achieved in the following ways:

• Buying and selling apartments in Spain with a subsequent surcharge. In this case, the profit will not be long-term.
• Resale of secondary housing after renovation.
• Renting out premises or housing in the medium / long term with receipt of rent.
• Renting out tourist real estate.

BEST CITIES FOR INVESTMENT IN SPAIN

Investing in housing and then renting it out is one of the most optimal ways to get additional income. The rental business in Spain largely depends on the region of its location.

The average rental price varies depending on the region of Spain. We can confidently name the following cities among the most profitable places for property investment:

• Navarra (ROI is 7.1%);
• Murcia (ROI is 7%);
• Valencia (ROI is 6.9%);
• Catalonia (ROI is 6.8%)

The lowest ROI is in the following autonomous communities:

• Madrid (ROI is 5.5%);
• Extremadura (ROI is 5.5%)
• Basque Country (ROI is 5.5%)
• Balearic Islands (ROI is 4.8%)

Rental price per square meter for June 2021:

PROPERTY IN SPAIN

Are you looking for property in Spain for investment? We have everything you need. We check every property offer at Spain.Real.Estate. Here you can find a detailed description of the property, plans, photographs. Check out our exclusive selection of property offers in Spain today!