The number of Spaniards whose income is generated by providing real estate for rent increased by 5% in 2022 and this trend will continue to grow. A lot of people are attracted by the high rate of return from such an enterprise — an average of 10% per annum, which can be increased to 14% if you choose the right strategy. According to a survey conducted by the international Academy of financial education Alfio Bardolla Training Group, 7 out of 10 Spaniards consider residential real estate as a reliable and safe asset for investment.
About 15% of those surveyed by the academy intend to start investing in this market next year. Mainly for reasons of preparing for the crisis. The provision of real estate for rent is considered as a reliable source of stable passive income. Novice investors are trying to make their assets the main source of personal and family income. Up to 81% of respondents indicated that they are confident that housing prices and rental rates will continue to rise over the next year, so they are eager to enter the market as soon as possible. Six months ago, 71.3% of respondents thought so.
The real estate market becomes the first choice for making investments among those who are looking for a decent income in the medium term. The fact that the value of real estate is growing simultaneously with the growth of inflation due to revaluation also plays into the hands, which makes it an extremely useful asset shelter in the current situation. Real estate is very weakly subject to random market fluctuations. At the same time, rental rates continue to rise in Spain.
Alfio Bardolla Training Group estimates that up to 25% of the Spanish population lives in rented housing. In other words, the demand is high, so the earning opportunities are high. Over the past 3 years, the demand indicator has grown by 5% and the pace should only gain momentum in the coming months. Also, according to the organization's estimates, today the average rate of profitability from investments in this sector ranges from 6% to 9%, but, as mentioned earlier, it is possible to choose business models that can increase profitability.
Among the non-rental income models, one can give an example of real estate flipping. As part of this process, the investor searches for «unwanted» real estate, which they want to get rid of as soon as possible, and therefore sell at a lower price. Then the object is bought, it is repaired and renovated, and in the medium term it is resold on the rise of the market. In the intervals of downtime, this property can be rented out.