Now is the right time to buy property in Spain

By ML
Director of Alanda Properties

As we have been pointing out over the last year, a series of factors have built up to create excellent buying opportunities. Real estate experts share a general consensus that now is the right time to buy property, specifically in Andalusia.

1. Ultra-low taxation. As we’ve covered in previous articles (Andalusia lowers Property Transfer Tax and several other taxes), early on this year Andalusia drastically reduced the taxes on buying property, to the point we have never seen such low taxes in this region.
2. Ultra-low interest rates. Interest rates are now at an all-time low, which enables would-be buyers cheap finance to secure a loan.
3. Pandemic & Brexit induced price reductions. The ongoing pandemic and Brexit have forced sellers to reduce their asking price creating once-in-a-lifetime buying opportunities for savvy investors.
4. Bull market. In Andalusia we are undergoing since April 2021 a property boom which has prompted a rise in property prices, specifically in coastal areas. Property is appreciating an average of 8% p.a. in coastal resorts and rising YOY.
5. Inflation rise. Having your money stuck in a bank is a losing proposition. In an inflationary environment, such as today’s, money depreciates losing its value day to day. Finance experts agree that a smart way to offset rising inflation exposure is to invest in real estate to avoid losing purchasing power over the long run as bank deposits devalue over time.
6. Plusvalia tax has been overturned by Spain’s Constitutional Court. As sellers no longer need to pay this tax, they have more room to negotiate with buyers a substantial price reduction to ensure a sale goes through.
7. Buy-to-rent. Annual rental yields are over 5% net. If you also add on top the capital appreciation (point 4 above), you are looking at a safe investment that is netting you over 10% p.a. risk-free. No other safe investment offers you such yields in a context of an underperforming bond market. In addition to this, the Spanish Tax Office offers lenient tax breaks which on average reduce landlord’s tax bills by 70%, or more (if EU resident). A landlord can offset most, if not all, of their property-related expenses, vastly reducing their income tax on buy-to-lets (i.e. holiday rentals). More on this topic in my article: Rental prices soar for 5th consecutive year in Spain! – 3rd February 2020.

In short, it’s never been safer and more profitable to buy property in Andalusia than today. Don’t fight the current and move with the flow; take full advantage of Spain’s real estate property boom.

We make buying properties in Spain simple and safe.

Contact me at Alanda Properties if you are buying or selling property on the Costa del Sol and Sotogrande. You will be surprised to learn the deals this new market has to offer on prime locations.

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