The days of fast returns at huge profits seem to be passing for those who are interested in buying property in Spain. Despite this, the Spanish property market still offers a great deal of potential, especially in the Costas where prices are beginning to plummet.
In this article, we’ll take a closer look at buying property in Spain and the Costas where prices are falling. Make no mistake, if you’re looking at buying property in Spain, this market is still expensive and maintaining value in many areas. The investment strategies, however, are changing and property values are anticipated to keep falling in some locales meaning there are ways to profit from Spanish property today.
Whilst Spain’s Mediterranean coast once was alive with development and offered growth of up to 20% a year, the climate has since cooled. With other coastal areas, such as Morocco, offering many of the same attractions at lower prices, interest in Spain has faltered a bit. This does not mean that the Spanish property market is dead though. It simply means it’s slumping. This, however, is very good news for investors looking for deals on buy-to-let properties, second homes and even full-time residential investments. It’s just not good news for present investors and most especially developers.
What investors are likely to see in Spain now is the modest growth other countries are experiencing with their property markets. House price growth has dropped to a modest 6% versus the double digits of just a few years ago. Building starts are also dropping a great deal as demand cools in the country.
Communities in the Costa Blanca area are offering the biggest price savings right now as panic selling seems to be a trend here. Some are anticipating a drop of more than 20% in pricing over the next year or so in this region. Whilst this doesn’t bode well for investors looking at fast returns, it is fantastic news for people looking at buy-to-let and holiday home potential. It is also opening the door for more retirees and expats to buy into the Spanish property market.
The pricing drop does not seem to be affecting high-end properties in the Costas. Properties that fetch EUR 400,000 or more are holding their prices quite well, experts report. Modest investors, however, are likely to enjoy much lower buy-in prices along the Costas in the coming months.
Buying property in Spain is a favourite British pastime. With an estimated 760,000 British citizens living in Spain full-time already, the expat community here is nothing to sneeze at. Brits desiring to join their countrymen along the beautiful Mediterranean coast are likely to find the coming months offer them many opportunities. Investors desiring fast turnaround potential, however, might want to look elsewhere in the sun.
