The high unemployment rate in Spain is taking its toll on
domestic property buyers who feel trapped in the private rental sector but are
unable to move to affordable homes because of restricted availability of
mortgage finance. According to the National Statistics Institute in Spain,
rental values for homes increased by 0.2% in January this year.
However, seen in context, the data soon reveals that
year-on-year rental values actually fell slightly in Andalucía, Castilla-La
Mancha and the Canary Islands, while much larger rental declines were recorded
in Murcia (down 1.5%), Madrid (down 0.8%), and Valencia (down 0.5%) among
several others.
Although at first glance this might appear to be bad news
for investors in Marbella or other Costa del Sol property markets, the
country’s continued appeal to tourists is making short-term holiday letting
still very appealing, particularly when considering the affordability of
Marbella property versus holiday rental yields per week.
Malaga’s long-term rental market has been rather hit by an
oversupply of stock. Here long-term rentals for a 5-bed, 3-bath villa with its
own garden and sea views has dropped to just EUR 500 per month - the same
rental value as charged for a 2-bed apartment in Mijas Costas.
In Marbella on the other hand, such properties command much
higher rental values and for holiday accommodation a 2-bed-, 2-bath apartment
in a small gated complex might cost as much as EUR 2,000 per week, leaving
investors a tidy sum after tax and running costs have been accounted for.
Even in winter a 1-bed, 1-bath apartment in Marbella’s
neighbouring resort Fuengirola will attract a holiday rental of around EUR 550
per week, making an investment of EUR 100,000 or less for a resale a pretty
sound bet.
Marbella’s multi-faceted attractions, from amazing beaches
and water sports to hiking and climbing in the Sierra Blanca mountains, have
long made the resort a favourite for property hunters. The super-wealthy have
their playground at Puerto Banus, where nonetheless luxury 2- and 3-bed
apartments with 2 or 4 bathrooms and exquisite interior finishes can be
purchased for less than EUR 459,000.
The resort offers property styles for every taste and varied
budgets, from affordable and cheerful in Elviria in the east of Marbella, where
new apartments start at around EUR 150,000, to golf resort property of a most
exclusive kind, where starting prices for a 2-bed apartment with all the
trimmings hover around the EUR 560,000 mark and where 3-bed apartments with 3
bathrooms cost a cool EUR 900,000.
This particular golfer’s haven consists of just 54 large
apartments with breath-taking views and access to all services and amenities
the 27-hole golf course on their doorstep has to offer. There’s a club house on
site with a bar and restaurant, a 5-star hotel and Spa, where property owners
enjoy preferential prices. The golf development is located within a 10 minute
drive to central Marbella, is within a 40 minute drive of the airport and just
a 5 minute drive away from the delights of Puerto Banus Marina.
Aided by experienced local estate agents and armed with an
expert foreign exchange broker a house hunter can save a lot of time and money
at the present time, especially when buying in cash. Credit availability is
still low in Spain as the country’s lenders are trying to get their own
finances into order following the housing market crash. For buyers from strong
economies such as Scandinavia’s the housing market in Spain has become far more
affordable thanks to a weak Euro and discounted property prices prevailing
across the country.
Wherever possible, buyers have taken out finance in their
own country rather than be disappointed by a Spanish lender. It pays to make
extensive enquiries into the finance issue before booking a Fly-to-buy ticket
via a local estate agency arranging property viewings in Marbella.
With a weak Euro buyers get far more value for money when it
comes to buying an investment or holiday home at the Costa del Sol. And with
discounted properties at 64% below their original listings, it is certainly
worth doing a little research!