If you have decided to invest in the Spanish real estate sector, you should take some aspects into consideration in order to make sure it’s a good investment. Buying a property to make it profitable through renting is not an easy task. If you do not choose your investment wisely, the property may take time to sell if it is not very attractive to potential buyers or if an economic crisis arrives. That’s why it’s important to make sure the property is in good condition and to bear in mind the running costs.
In order to help you identify if the property you wish to buy is a suitable investment, here is some recommendations:
- Make sure the property is in good condition. Painting a wall or unclogging a toilet is not excessively problematic. However, if it is badly deteriorated, and you are facing frequent repair costs, or if it requires a complete renovation, it will be necessary to check the numbers so that the investment is profitable in the short or medium term.
- Consider all fixed costs such as those derived from the community of owners (“Comunidad”), the IBI property tax of the home, as well as other taxes, a possible non-payment by the tenant, a possible additional payment of community fees (“derrama”), and so on. Everything counts when it comes to assessing the profitability of a property.
- Choose a good location. If what you want is to have your home always occupied, choose a property capable of satisfying the needs of a wide public, no matter what your personal tastes and needs. Choose a flat preferably with two bedrooms, schools and commercial zones nearby, good infrastructure, public transport, restaurants, etc. For a first-time investor, we never recommend betting on new, unconsolidated neighbourhoods that may take years to be in demand.
- Find out the real price at which you will be able to rent it. The most common way to put the price of renting a home is to look for the price of other similar properties in the area.
Published first by idealista.com