Many people are bemoaning the current state of the Spanish property market but like every market experiencing a period of adjustment a whole range of opportunities arise. Clearly prices are now at a more manageable level and entry into what was otherwise the domain of the rich and famous is now even more attainable.
With developers discounting their properties to compete in the current market conditions, many shrewd investors are taking advantage of the situation in Southern Spain, utilising finance packages which will cover 100% of the purchase price and, in some cases, even cover all the purchase costs and taxes. This is made all the more interesting when you consider that just 6 months ago you needed a minimum deposit of 30% of the purchase price plus an additional 12 – 14% to cover purchase costs such as VAT, stamp duty, lawyers fees etc..
So what does this all mean to the average person in the street looking to buy an overseas property?
Now everybody has the opportunity to invest in one of the more established markets of Europe with little or no capital. Compare this to Bulgaria where although property per square metre is much cheaper you still need a hefty deposit averaging between 30 – 50% of the purchase price, plus the additional purchase costs usually in the region of 23 – 25% (sometimes less, though the 20% VAT is often hidden in the purchase price). There is always a reason for price variances from region to region, the UK is a very good example of this, and the fact is that Spain is often more expensive than other alternative “emerging markets” can clearly be attributed to the advanced infrastructure, enviable climate, coveted lifestyle, spectacular scenery and chic cosmopolitan resorts.
In recent years, however, the region has experienced unprecedented levels of investment, both in the public and private sectors. Major schemes presently underway, or on the drawing board include the expansion of Malaga’s international airport and seaport, the extension of the coastal railway from Malaga and Fuengirola to Marbella and San Pedro, a state of the art marina at La Cala de Mijas, the scaling up of various other yachting harbours, the arrival of the high speed AVE train from Madrid and of course, Disney drawing up plans for a possible park on the Costa del Sol which could transform the area’s tourist industry.
With flights to Malaga airport from the UK alone averaging over 60 arrivals per day, an average of 320 days of sunshine and the highest concentration of golf courses in mainland Europe it is also no wonder that the rentals market is also very buoyant.
To recap, the opportunity now exists to buy a fully financed property in, what is still the number one destination of choice for overseas homebuyers in the UK, with little or no deposit and attract some of the highest weekly, monthly or long term rentals in Mediterranean Europe.
Professional investors buy when share prices are low; not when the market is at an all time high.