Renting out housing was and still remains one of the most profitable ways to make money on the Spanish real estate market. In 2022, the gross annual profit in this sector ranged between 6.5% and 7.7%. Every year thousands of small and medium-sized investors enter this market, earning solid money. According to the Fotocasa portal, only among Spanish real estate buyers about 7% have purchased housing as an investment. Most of them planned to use it as a passive rental income tool.
In 2023, the situation does not promise noticeable changes. Analysts still expect a large influx of new investors and profits within the specified framework. Even despite the new and contradictory laws, such as a 2% limit on the increase in the rental rate, the market remains stable. In addition, the return on investment from the lease is still higher than from other investment instruments. For example, the Spanish stock exchange fell by 5.6% in 2022. Ten-year government bonds offer, at the same time, only 3.5%.
Ernesto Ferrer-Bonsoms, Business Head of Solvia, points out that this year the acquisition of residential real estate for rent is again positioned as one of the most profitable investment options. One of the key reasons for this statement, he cites extremely high consumer demand. Fewer and fewer people can afford to buy a home, so they are increasingly looking at the rental market.
Another reason for the good prospects of the rental market in 2023 is the forecast for higher growth rates of rental rates in comparison with the prices for the purchase of housing. This is a characteristic indicator for this market — if rates rise faster than prices, then profitability increases. Forecasts for the second half of the year are more vague than for the first, but there are no sharp changes in the trend. At least, if there are no unexpected shocks.