Spain Explained

5 advantages of investing along the Spanish coast

Last updated on April 3rd, 2020 at 11:29 am.

Alicante, Malaga and Valencia are some of the most popular areas for foreigners to buy in for investment purposes. The popularity of purchasing property in Spain continues in spite of some of the political and financial issues that have hit the countries where purchasers typically originate from. Why?

In a recent article in the Spanish publication ‘Inmodiario’ they suggest that there are five reasons why people invest in rental property on the Spanish coast:

  • They are attractive to rent
  • There is a vibrant market
  • Spain remains a tourism centre
  • There are many luxury homes to choose from
  • It’s the perfect place to retire

According to the Instituto Nacional de Estadística Barcelona, Alicante, Malaga and Valencia are the preferred locations for purchasing property in Spain for investment purposes.

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Attractive to rent

Although prices have risen since the crisis, the cost of buying on the coast is still below that of the boom years and you can get an attractive property for a very reasonable price. Many people now choose to organise their holidays independently rather than spending on a package deal. Properties in prime position, such as by the sea or near golf resorts, are particularly in demand.

Properties are sought for short term and long term rental. Many people who have chosen to live in Spain or spend a large part of the year here prefer now to rent than to buy. In some areas this has led to a shortage of available rental property.

A vibrant market

Property purchases in Spain by foreigners during 2017 amounted to 13% of transactions. Areas close to the beach were particularly popular and in some areas the percentage of homes bought by foreigners was much higher. In the Balearic islands foreign investment counted for 44% and 27.44% in the Valencian community.

It’s true that there has been a drop of about 10% in the number of properties bought by British people following Brexit. However, other markets have risen including that of foreign investment from Belgium, Italy, Germany and China.

Centre of tourism

The Mediterranean coast and the islands are where the largest number of tourists head to. In the summer, the coast is buzzing and the all-year round temperatures mean that the Canary islands are a prime choice for holiday makers whatever the season. Alicante is also well-known for its favourable climate with slightly milder summers and warmer winters. These factors mean that properties are good for rental across most months of the year.

A paradise of luxury homes

When people are looking to rent something a little extra then some areas, such as Alicante, are ideal for the number of luxury homes that can be found there. Luxury developments are available in places such as Moraira, between Javea and Calpe. Some builders have prioritised the construction of more expensive properties and they seem to be selling well.

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The perfect place to retire

Many European foreigners are now enjoying their retirement along the Spanish coastline. The climate and the food has proved to be a real attraction. As pensioners benefit from the accumulation of capital in their first home, the idea of having a place to retire in a warm climate has proved to be too good to resist.

All in all, it is good to see that Spain continues to be such a sought after destination for many people living throughout Europe.

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Carol Hale

25 July, 2019 2:25 pm

Hi, I’m after any advice
Hi, I’m after any advice concerning renting my property out for holiday let’s. I bought my little bungalow nearly a year ago, with the intention of renting it out for holiday rentals, ( which the agent was aware of) I thought I had done all my homework on this matter. But then I started coming across the legal size that your bathroom has to be , and it must include a bath not a shower which mine does not. I have had conflicting advice from lots of different agents on this and have come no closer to finding out if I can apply for a tourist licence or not on this property. So far it’s sat there a year just costing me money, Previously I had successfully rented a property out in Turkey for nearly 10 years as a holiday let and didn’t dream that Spain would be so much more difficult, so I don’t know what to do now, if I sell I will lose a lot of money and this was hopefully going to top my pension up and give me some lovely holidays but has turned into a bit of a nightmare.
Kind regards
Carol Hale

Suzanne O'Connell

2 August, 2019 5:50 am

Dear Carol

Dear Carol

Thanks very much for your enquiry. The difficulty here is that each province has different legislation and in some areas it's the town hall that sets down its own regulations. You need to obtain local information from the area where your house is.