Buying a Spanish property

Factors to be aware of when buying Spanish property include property scams, high capital gains tax, and fluctuations in the Spanish property market.


The Spanish property market has many quirks, and it pays to do your own property market research before buying a house in Spain. Knowing what to expect when buying a property in Spain can help reduce any pitfalls of setting up your life abroad.


The Spanish property market


Spain has been badly affected by the global financial crisis and a property market crash. Since 2008, Spanish property prices have fallen by 30 percent overall, with some regions even worse off. Individual properties are selling for as little as half their 2007 price. Property prices remain low and are falling, which means that although the price drop can be a boon to new arrivals, making property more affordable, there is a strong risk that your home will lose value before the market picks up again.

Over 80 percent of Spanish residents own their own home, with around 50 percent of the population owning their home outright, without a mortgage. As many sellers are looking to recoup as much of their investment as possible, haggling can be drawn out and the market slow. However, with few buyers around, you may find you have your pick of bargains.


Should you rent or buy in Spain?


Rental opportunities can be limited in Spain as people prefer to buy, and with property prices low you may find you have more choice to buy than to rent. That said, prices for desirable, convenient, city centre properties are similar to those in other European countries such as Germany, Belgium or Ireland, although prices are predicted to fall further in 2014. Waiting may allow you to buy at a better price and in a more stable market.

The transaction costs of buying and selling a property in Spain are moderate, at around 15 percent of the property value. This means that even if property prices rise during your stay, you'll probably need to live in the property for around three years to come out ahead in a strictly financial sense.

For those considering a shorter stay however, renting could be a more suitable option if you factor in Spain's capital gains tax of more than 20 percent, which could offset any benefits of buying in the short-term. You can find more information on rental properties in Expatica's guide to renting in Spain.

Are foreigners allowed to buy property in Spain?
Yes. There are no restrictions on buying property in Spain, whether it's commercial, residential or land. In fact, Spain encourages investment by foreigners, both resident and non-resident. You will require a financial number which can acquire by visiting a police station with your passport. This is typically done on the day for Spanish or EU citizens but may take a few weeks for others.

Buy a property, get a visa
Spain currently offers a 'golden visa' program for property owners. This is a form of investor's visa. If you invest more than EUR 500,000 in Spanish property, buying one or more properties, you will normally then be automatically eligible for a residency visa. This is not a work permit, but it will allow you to live in the country. It's primarily aimed at retired people and holiday home buyers.


How to find a property to buy in Spain ?


As it is easy for foreigners to buy property in Spain, there are websites and estate agents catering to almost every language and nationality. Many British real estate websites also list Spanish properties, with some online portals listing thousands of options. However, these mostly focus on holiday homes, so you may prefer to use a Spanish site, such as the ones listed below.

As you don't need to be resident to purchase a property, it is possible to buy a home before you arrive and move in directly. However, this naturally comes with certain risks and we strongly recommend that you view the property you are considering and don't cut corners on the process, even if this means spending some weeks in a hotel when you arrive.


Online property portals :


comprarcasa (Spanish only)

venta de pisos (Spanish only)


Advantages and disadvantages of using an estate agent


As estate agents are typically paid by the seller, there's a strong advantage to using them for buyers. Estate agents can often provide detailed information about the region or city you're considering. Many are bilingual and accustomed to dealing with overseas buyers. However, regulation is relatively low and unscrupulous estate agents do exist. Be wary of anyone who asks for payments upfront or suggests cutting corners. Always remember that you can choose your own notary, mortgage provider and so forth – you do not need to use a service suggested by the estate agent.


Illegal properties


For over 20 years, Spain has been popular with overseas buyers looking for holiday homes. Large numbers of inexperienced foreign buyers provide an opportunity for unscrupulous developers and estate agents to sell properties which are not legitimate. In some cases, planning permission has not been acquired before building, and properties are eventually torn down by the local government. In other cases, the quality of the property has not been up to scratch or as indicated, resulting in costly repairs.

The British Foreign Office has issued notices warning expat buyers to be cautious and not take unnecessary risks. They recommend, at minimum checking:


The credentials of any lawyers or estate agents used;

the land registry (Registro de la Propriedad);

that appropriate planning permission has been obtained;

that there are no outstanding debts attached to the property, such as a


that the property is as described and structurally sound (either a surveyor

or an architect can do this).


Most of this information can be provided by the land registry and accessed by making a request by email, phone, fax or in person. You can find the appropriate land registry office by vising the national website: (Spanish only).


Buying off plan or a new-build home
The worst property scams in Spain, as elsewhere, have involved properties bought before they were completed or, sometimes, started. While malicious intent is rare, the building market is struggling and caution is advised when buying a property which does not yet exist. At minimum you should:


Check the company exists and is officially registered; check online at (Spanish only).

Ensure that the project is registered with the land registry.

Check that planning permission has been granted by enquiring at the

local city hall.

Not sign a contract you don't understand.

Ensure that any translation is done by an independent party.

Demand proof that any sums paid (e.g. a deposit) are being held or spent


Proof of insurance that will refund your money if the property is not built.

As a non-resident, you may also buy land and have a property built yourself. In this case, good legal advice is even more important as you will need to ensure that contracts with builders are appropriate and watertight.


Debts transfer with property


In Spain, any mortgage or debt tied to a property is transferred to the new owner when the property is sold. It's thus critically important to ensure that there are no debts attached to the property when it is sold, or that if there are, they are covered by the terms of the contract. Debts may include:

A mortgage;

payments due to a tenant's associations;

property tax (impuesto sobre bienes inmuebles).


Buying a Spanish property

The process of buying a property in Spain usually runs as follows. First, the buyer makes an offer, usually through the seller's estate agent. If this is accepted, then the buyer and seller sign a preliminary contract (contrato privado de compravento) and the buyer pays a deposit, typically 10 percent of the purchase price.

The buyer then arranges any mortgage they require, although they should have already discussed their needs with the mortgage provider. The contract of sale (escritura de compravento) is usually signed in front of a notary, at which point the full sale price, taxes and other costs become due. 


Legal requirements


The services of a notary are not legally required to complete the sale, but it is advisable and required by many mortgages.

The seller is responsible for hidden defects in the property, even if they are not aware of them. However, in practice gaining restitution for such defects can be difficult and costly.

Paying the costs and taxes associated with buying a home can be completed by the buyer or their agent. It is the buyer's responsibility, however, to ensure taxes are paid.

The buyer is also responsible for registering the property. The notary may provide this service for a fee, and/or may notify the registry office that the sale has taken place, without completing full registration.


Funding purchase: deposits and mortgages


Following the 2008 crash, Spanish banks have been heavily reformed with significant IMF involvement. This has reduced the number of lenders from around 50 to around 12, and significantly increased the regulation and oversight of the industry. As a result, many banks are lending less and mortgage rates and terms have become less favourable.

Mortgage lenders will not complete on a mortgage agreement until you own a property. For this reason, it's important to include a clause in the contract allowing you to exit the agreement if you cannot acquire a mortgage.


Fees and charges


Costs are primarily paid by the buyer, and vary from region to region. Many are negotiable – there are no fixed fees for lawyers or estate agents. Costs paid by the buyer are typically around 8–14 percent of the property value and include:

Property transfer tax 5–10 percent (existing properties);

VAT (or IVA) at 10 percent (new properties);

notary costs, title deed tax and land registration fee 1–2.5 percent;

legal fees 1–2 percent (including VAT).

The estate agent's fees are usually paid by the seller, and this is typically their only cost. Estate agents usually charge a percentage, typically around 3 percent of the final sale price.


Capital gains tax

Spain has a capital gains tax of 21–27 percent. To avoid this, sellers will sometimes request buyers to list the sale price as being lower than they actually paid. This is inadvisable as it can cause legal problems. Listing a lower sale price than you paid can also increase your own capital gains tax bills at a later date. 

Capital gains tax is paid on the profit of selling your home, i.e. the difference between the listed purchase price and the listed sale price. Thus if you pay EUR 200,000 for a property and sell it for EUR 250,000 you will pay capital gains tax on EUR 50,000. However, if you previously accepted to list the purchase price as EUR 150,000, you will then be required to pay a capital gains tax on EUR 100,000. 

If you are a resident and Spanish tax payer then the profit from selling your property counts as part of your savings allowance. If you've already exceeded the EUR 6,000 threshold or are non-resident, the tax rate is 21 percent. This would mean paying EUR 10,500 on the profit of EUR 50,000 described above, or double that if you'd listed the lower sale price. 

You may be able to claim a reduction on the capital gains tax to account for inflation; or if you are purchasing another property in Spain; or if you are over 65 and have lived in the property as your main residence for more than three years. 

Otherwise, unlike in other countries, capital gains tax applies no matter how long you've lived in the property. Your residential status does not affect the application of capital gains tax either, as capital gains tax should be paid in Spain for property owned in Spain even if you are no longer a resident. 


Choosing a reliable lawyer

Any lawyer practising in Spain should be registered with the local bar association (Colegio de Abogados). They will have a registration number that you can ask for and then verify with the bar association. Naturally, registration does not guarantee honesty or competence, but it is a good minimum standard to insist on. You can find a list of all the bar associations at the national website for Spanish lawyers, Abogacía Española.


Finding a translator

Many governments provide lists of lawyers and translators who speak both Spanish and another language. The British Embassy's list of English speaking lawyers and translators is a useful resource. The Spanish government also provides a list of accredited translators.


Selling a property

The Spanish property market is in a difficult state at the moment, and you should not expect to sell a property both quickly and for a good price. Moreover, experts predict that prices will continue to drop in 2014, which means that you may struggle to recoup your investment.


Spanish Property Market 2017 

In many respects this review of the Spanish Property Market in 2016 and the look ahead to the trends for 2017 is not that different when compared with what I wrote last year; as regards the general economic outlook it seems brighter in parts but the structural problems that are hindering meaningful and sustained recovery are unchanged and likely to remain so. In the property sector itself it’s no different, almost all statistics are on the up, mortgage approvals, sales numbers, construction starts, for example, but when you dig deeper into the numbers the same issues remain, fragmenting the property market into sectors that are still performing very differently. As I will show there is sustained growth and strong demand from overseas buyers in prime city and Mediterranean locations while such growth as there is within the domestic market and the lower end of the overseas market still feels fragile, as though it wouldn’t take much to knock it off course.

What I aim to do in this Spanish Property Market report is bring together the statistics and opinions from various sources published throughout the year and try to give a coherent review of what happened to the property market in 2016 and a look ahead to 2017. I find the most reliable property statistics are those from the notaries as they reflect exactly when a purchase took place; a deal signed in December will be counted in December’s returns. If you see contradictory numbers the explanation is that Spain’s Institute of Statistics (INE) also takes returns from the Property Registries and they are not counting when a deal is actually done but when the transaction is inscribed in the registry and delays of weeks and even months are common. This can affect both quarterly and full year data. For example, a purchase signed at the notary at the end of any quarter won’t make it to the registry until the following quarter but the worst distortion is in the annual figures; a purchase signed for in front of the notary in a December, and possibly even the November, is unlikely to be registered until January of the following year at the earliest. And the discrepancy caused by these rollovers is not insignificant; full year 2015 data showed 458,781 purchases recorded by notaries but only 403,703 properties inscribed at Property Registries, a difference of 12%. The Registry figure for the number of foreigners who bought in Q1 and Q2 of 2016 was 39,666 but a few weeks later the notarial returns showed the higher figure of 43,519 in the same period, a 10% discrepancy.

So, throughout this report where a statistic is given that relates to purchase numbers, when and where done and by nationality, it will refer to notarial returns unless otherwise stated and I ignore the returns from the Property Registries. Some statistics will be partial in respect of 2016 but I will update throughout 2017 as 2016 full year data is published so please check back or follow us on Twitter, where I report news and statistics almost daily. I’m going to cover the domestic and overseas property markets separately because they function completely independently of each other; the former is inextricably linked to what is happening in the Spanish economy while that same economy is irrelevant to the the latter. Brexit gets a mention and among other matters I’ll discuss prices, mortgages, who’s buying what and where and what might be ahead in 2017.


The Overseas Market – it’s even better that I thought
The notarial returns counting the number of overseas buyers for the first half of 2016 produced a statistic that took me completely by surprise; a total of 43,519 transactions were completed by non-Spanish buyers in the first six months of the year, representing 19.1% market share. Given that the previous highest annual total of foreign buyers was around 80,000, or 8.9% market share of the approximately 900,000 units sold in 2007 right at the top of the market, a half year total of 43,519 puts 2016 on track to be the best year ever for overseas buyer numbers in Spain. Even if there is a fall in the second half of 2016, which looks unlikely given continued overseas market growth into Q4, in spite of a reported downturn in British buyers since the Brexit referendum, I see the full year total at least matching the previous record high. In fact, I think it is going to beat it although we’ll have to wait until about May 2017 to find out as the notarial returns for the full year usually appear in Q2 of the following year. I could sense that 2016 was going to be a good year but I wasn’t expecting record highs of foreign buyers quite so soon.

But there is always a ‘but’ and in the case of the overseas market right now it’s not so much about who is buying but where they’re doing it and these same notarial stats show very starkly that the recovery continues to be confined to a handful of locations and then only in the most prime spots within those locations. The result is that we now have the same number of foreigners buying in Spain as at the pre-crash peak but concentrated in just a few places, and that helps explain why it feels so active in the 5* locations and still so flat in what I call the secondary and peripheral areas.

Andalucía, Spain’s largest autonomous region, is a good example of market unevenness. Since 2014 Andalucía has consistently been the most active region in Spain by sales numbers per region but when you analyse the data it becomes clear that this has been driven by activity in just one province, i.e., Málaga, home to the prime part of the Costa del Sol, a hot spot of overseas activity. Based on 1st half 2016 figures, and I have no doubt that the trend will be replicated by full year stats when we get them, 75% of all overseas buyers in Andalucía bought in Málaga province, a total of 5,570 and the highest ever recorded in the first two quarters, more than at the 2007 peak. The next most active province was Almería, with just 797 foreign buyers, while Córdoba only managed 49, the lowest of the eight Andalucían provinces. And whereas Andalucía as a whole was below the 19.1% national average in respect of overseas market share, registering only 14%, in Málaga province it was double the national average, at 39% of the 14,364 total transactions. And within the province different municipalities clearly demonstrate how uneven activity levels are. For example, more than 50% of all transactions happen in just two municipalities, Málaga city and Marbella. Just two municipalities, Marbella and Benahavis, account for 25% of sales in the province. And it’s no different in any of the other regions of high overseas investment, that is, the Mediterranean coasts, the Balearics and Canaries and Barcelona; all show 2016 overseas purchases above the national average. For example, in Alicante province, the most active region on Spain’s eastern coast, overseas buyers were responsible for an astonishing 46.7% share of the total market. So, if you are trying to make sense of the Spanish property market it’s important to realise that the region tells one story, the provinces within that region another and the municipalities yet another, with local hotspots of much higher market share.

In early 2017 we started to get full year stats for 2016 and all my predictions were confirmed. I thought price rises for 2016 would be around 4% on average and the figures showed it was 4.7% but I also predicted bigger increases in city centres and prime Mediterranean coasts. And that’s how it turned out with Madrid registering 9%, Cataluña 7.4% and the Balearics 5.7%. I predicted that the transaction numbers would have grown by at least 10% during 2016 and the full year data came in with 458,781 purchases, an annual increase of 12%. Bank lending recovered to the extent that roughly 50% of 2016 purchases were funded with a mortgage, up from about 30% the previous year although the banks are still cautious; the average loan amount increased by barely 5%, just enough to keep pace with average price rises. Nevertheless, in spite of the improvements in the overall picture I still maintain, as I did twelve months ago, the property market in Spain was very reliant on overseas buyers for much of the growth seen in 2016 and it will be the same in 2017, particularly at the higher price levels. At the end of 2016 I started work for an international buyer wanting a house right in Málaga city and it quickly became clear that Spaniards themselves don’t have much confidence in the domestic market recovering anytime soon. All the vendors I spoke to, with properties for sale at €1m and more, were very sceptical about the likelihood of a Spanish buyer and thought their best chance was a deal with a foreigner.


The Domestic Market – the scourge of unemployment
By every measure, such as sales numbers, mortgages granted and price rises etc., the domestic property market in Spain is in better shape in 2017 than it was a year ago which begs the question: why doesn’t it feel that much better? I think the answer is that it’s struggling back from an abyss that was so deep it’s going to take much more than a few quarters of better data for the feel good factor to return. For some perspective, it’s worth repeating just what happened to Spain’s economy in the last decade, or should that be the lost decade. In 2007 it was the fastest growing economy in the Eurozone at 3.5% with a budget surplus. Five years later it had the highest unemployment rate in the developed world and a banking sector close to meltdown in spite of the OECD rating it as solid in 2010. You know it’s been really bad when the unemployment rate falls to below 20% for the first time in six years and it’s hailed as a victory when in reality the October 2016 figure, at 18.9%, was still the second highest in the E.U., just behind Greece.

It seems clear to me that Spain’s inability to get people back to work, particularly into full-time, permanent jobs will continue to be an important brake on the domestic property market in 2017. The harsh reality is that, according to Ministry of Employment statistics at the beginning of 2016 fewer than 5% of labour contracts were for full time, permanent positions and 37% of contracts were for durations of less than one month. Even worse, 20% were for jobs lasting less than seven days. A 2016 report by economic think tank Fedesa highlighted the fact that 25% of those unemployed haven’t worked in at least four years and a 2016 survey by Eurofound, an EU agency focused on living and working conditions, reported 26% of Spanish workers thought they would lose their job within six months. And the OECD’s forecast for Q4 2016 cited the lack of permanent contracts and the lack of jobs for the under 25s as just two of the factors contributing to Spain’s stubbornly high unemployment rate and the same report predicted only a very slight decrease in the national average to just under 18% by the end of 2017.

It’s true that the national average declined throughout 2016 but even when it’s below 20% that still leaves nearly 4m people out of work. And averages mask regional variations; in Extremadura, Andalucía and the Canaries the rate is still 25%+, while in the Basque country, Cantabria and Navarra it’s below 13%. In the case of the under 25s it’s still a catastrophic 45% nationally and over 50% in some regions. More than 700,000 households have no one in work and 80% of the under 30s still live in the parental home. One result of these figures is that there are fewer new households being formed in Spain leading to lower demand for housing.

Another factor leading to lower housing demand is Spain’s shrinking population, due to low birth rates and emigration exceeding immigration. The lack of jobs has forced both immigrants and Spanish citizens to leave Spain to look for work and at the start of 2016 the stats showed 98,934 Spanish citizens had left the country in the previous twelve months, against 52,227 returnees. Perhaps the most worrying statistic to emerge in 2016 was the decline in the number of people aged between 20 and 39 years old, down by some 400,000, the very demographic Spain needs to hang onto; young, educated, professional and entrepreneurial. According to Javier Díaz-Giménez, Professor of Economics at Spain’s IESE Business School, there are few countries in the developed world where unemployment has been over 20% three times in 20 years but Spain is one of them. The last time it peaked above 20%, in the 1990s, it took 14 years to decline to the European average. If history repeats itself and if we date the start of this cycle’s explosion of unemployment to 2010 it’s going to be 2024 before Spain gets close to the European norm, and I recall I quoted a prediction from PricewaterhouseCoopers in my 2014 report that Spain wouldn’t return to pre-crisis employment levels until 2033! The reality is that Spain has never got close to full employment and even when it was the fastest growing economy in the Eurozone in 2007 unemployment was 8%, a figure that would be considered high in an economic downturn by many developed countries.

Although labour market reforms have reduced redundancy entitlements, businesses and employers remain reluctant to offer permanent positions and this is borne out by the imbalance between indefinite and temporary contracts that now exists in Spain and there are no signs of it changing; in fact, it worsened during 2016. With this kind of labour market how can one expect sustained recovery in the property market – the unemployed, those fearing unemployment and those on short-term temporary contracts don’t buy houses. And neither do those in employment who have seen purchasing power reduce by nearly 10% since 2008, according to 2016 figures from the INE, a combination of lower or stagnant salaries and rising prices.

Meanwhile, the powers that be in Brussels continue to demand more austerity to reduce the current budget deficit of 4.6% to the target of under 3% of GDP by 2018, two years later than previously demanded, while the Spanish government maintains the target will be met as the economy grows, thus avoiding the need for more cuts. Growth was predicted to be a respectable 3.2% in 2016 but the IMF, the Bank of Spain and the European Commission all believe it will slow, possibly quite sharply, in both 2017 and 2018. At least Brussels relented on the threatened €2bn fine for missing the 2015 deficit target, how kind of them. However, it is still demanding €5.5bn in further cuts to ensure the target isn’t missed again. They must be going soft – earlier in 2016 the European Commission was demanding budget cuts of €8bn. Now all Spain’s new minority government have to do is get the 2017 budget proposals through parliament.

Nevertheless, in spite of everything, the domestic market is in better shape when 2016 statistics are compared with 2015. Building licence approvals for new build to the end of October 2016 were up 33% at 53,131 nationally although I can’t resist pointing out that for the same period in 2006, just as the building frenzy was at its peak, the figure was over 550,000! The silliest month on record was September 2006 when 126,753 building licenses were granted, just about double the total for January – October 2016. Madness that is still having repercussions today.


The Brexit Factor
The British are the single largest group of overseas buyers in Spain by some margin, always have been and probably always will be but, in my opinion, a lot of nonsense has been written about the effect the result of the EU referendum is having, or will have, on the Spanish property market in 2017. Some commentators used Q3 Property Registry returns as an indication that British demand had fallen 16% as a direct result of Brexit. However, as I pointed out at the beginning of this report Property Registry statistics don’t tell you anything about that actual quarter, they are a reflection of what has happened previously. The fact that a property was registered in Q3 and the fact that fewer British purchases were counted in those Q3 returns says nothing about post-Brexit sentiment as we aren’t told how many of those Q3 registrations related to purchases completed in the previous quarter. A lot will have been, so Q3 stats from the Registries say just as much, and possibly more, about pre-Brexit Q2 as post-Brexit Q3.

Four of every five foreign buyers in Spain aren’t British so while a 20% market share isn’t insignificant there are so many other nationalities buying in Spain now the potential damage to the overall international sector is limited; the statistics clearly show international demand is rising even though the British may make up a smaller part of the total overseas market. In comparison with the Spanish market crash in the early 1990s, the implosion of the UK economy that was the main factor behind the collapse really did cause the property market to hit the buffers because the overseas market was 80%+ British, but that is not going to happen this time as there are plenty other international buyers to minimise the impact even if there is a noticeable fall in buyers from the UK. However, in my view, the more reliable figures, those from the notaries, seem to indicate the British element of the overseas market is holding up rather well, all things considered.

In 2015 the notaries reported 76,780 purchases by overseas buyers, of which 20.1% were by British, i.e., 15,810. In the first half of 2016 the notaries counted 43,519 overseas buyers with the British responsible for 8,268 of them, very slightly down on market share at 19%, but slightly ahead in actual numbers on a half-yearly basis when compared with 2015. Now, I’m no mathematician but even I can see that a smaller market share in percentage terms doesn’t necessarily mean lower numbers of actual purchasers. Nevertheless, the total of British buyers in 2016 is the statistic I’m most looking forward to seeing in the first half of 2017. My prediction is that numbers will be similar, maybe a bit down but could even be up, compared with the previous year but because the overall overseas market grew in 2016 the British share of the market will probably be lower.

What I do not foresee is a collapse of the market as some are predicting. And even if the 2016 result does turn out to be lower British buyer numbers, British developers and British-based investors don’t seem at all deterred by the post-referendum atmosphere. London-based Pacific Investments are putting €25m into a 5 villa project in Marbella. British retail specialist Intu are planning a €600m investment in what will be the largest shopping and leisure complex in Andalucía at Torremolinos. The Round Hill Capital Investment fund, also London-based, are behind a €250m development in Ojén, 7kms inland from Marbella, developing land acquired from SAREB, Spain’s bad bank. Although some hesitation was reported in the immediate aftermath of the referendum, the fund decided to go ahead because the properties are not just targeted at the British market; of the 75 units in the first phase 50% are already sold to 16 different nationalities, underlining the point I made earlier in this section; the overseas property market in Spain is no longer as dependent on the British market as it was 25 years ago, buyers come from around the globe and a British blip, if there is one, will barely be noticed.

The British started buying property in Spain long before either country was in the EU and throughout the period when the UK was in but Spain wasn’t. I cannot imagine a scenario in which Spain will allow anything to damage their most important market post-Brexit, either in the the property or tourism sectors where the British are way ahead of any other nationality, and I don’t believe a possible downturn in the numbers of British buyers in 2016, if that’s how it turns out, can be attributed to uncertainty about the conditions that may apply to British citizens post-Brexit. In my view lower numbers will be a reflection of short-term currency instability, a factor that’s obviously closely linked to Brexit, but one which looks unlikely to get worse and may get better, perhaps a lot better, if there is renewed Eurozone instability, which most analysts regard as a cast iron certainty. However, British buyers who wait for an improvement in the exchange rate may find any benefit wiped out by price increases in 2017 but there is a solution and it’s one that more than one client of mine has opted for recently, choosing to buy now while prices are still well below 2006 peak values but clearly on the way up. The solution is called a fixed rate Spanish mortgage and in my view, it’s one that anyone thinking about buying in Spain in 2017 should consider, irrespective of the currency they are buying with.


Spanish Fixed Rate Mortgages – grab one if you can
The GBP£ went on something of a rollercoaster in 2016 after peaking in December 2015 at €1.41/£. Six months later, just prior to the EU referendum it had fallen 10% to €1.28 and a further 14% came off post-referendum to an October low of €1.10. The harsh reality is that a British buyer could have bought a €500,000 property in December 2015 with £355,000 but would have needed to exchange £445,000 in October 2016. The last time we saw such a weak €/£ rate was after the 2008 global banking crisis when it fell from mid-2007 highs around €1.48 to a low of €1.10 in January 2009.  I recall much talk then of parity but slowly the pound recovered and never went below €1.10 and it will be interesting to see if €1.10 is as bad as it’s going to get in this cycle.

I think there were three groups of British buyers immediately affected by the post-Brexit currency fall. Firstly, those wanting to buy but not yet committed and who could delay their purchase, but running the risk of seeing any improvement in the exchange rate wiped out by price rises in the meantime. Secondly, cash buyers who had already exchanged contracts and were committed to completing the deal within a few weeks, needing to find extra funds they hadn’t budgeted for. And finally, and worst hit of all, those who had already taken a mortgage up to their borrowing limit and signed a purchase contract on the strength of the mortgage offer. This last group faced two stark choices, both unpleasant – either default and lose their deposit or find a way to fund the shortfall. However, there have been very few such buyers in the market in recent years, that is, people borrowing to the maximum because they needed a mortgage.  It’s a fact that the majority of all overseas buyers in Spain since the crash have been cash-rich although, as interest rates fell, many chose to hold on to some capital and take a Spanish loan; they didn’t need one, it just made good financial sense and several clients of mine have done just that.

My advice to current cash buyers, irrespective of the currency they are in, would be to protect as much of their capital as they can and take a Spanish mortgage for as much as they can get and that’s because fixed rate mortgages, which disappeared after the 2008 financial meltdown, reappeared in Spain in 2016 with long fixed terms available. At the same time, Euribor, the rate that sets the interest rate for the majority of mortgages in Spain, went negative for the first time in February 2016 and after eleven straight months of further decline closed 2016 at another historic low, -0.080%.  And the trend continued into the new year, falling to -0,106% at the end of February 2017. Fixed rate mortgages accounted for 28.6% of all new loans in 2016, and in November 2016 a client of mine was offered 70% LTV at 2.4% fixed for 20 years, or 2.10% for 15 years and 1.9% for a 10 year fix, life cover included.  He chose the 20 year option. The broker involved said the majority of overseas applicants were taking the fixed term option, reasonably confident they could invest the freed-up capital to equal or better the interest rate charged so early redemption charges weren’t an issue, they don’t intend redeeming early.  For those who would prefer to pay off or reduce the loan in the short to medium term, say 3 – 5 years, a variable rate loan could be an option, quotes of 1.75% above Euribor for 60% LTV and 2% above Euribor for 70% were given, assuming life cover is taken.  Early redemption fees for variable loans are 0.05% in the first five years and 0.25% thereafter and it is possible to negotiate zero on partial overpayments.

Obviously, external factors in 2017 could alter what’s on offer month on month. In early 2017 there were already signs that rising bank charges will push rates higher during the year and you need to check in advance what your status is. But if the banks are willing to lend why not take it, particularly if you are British, as not needing to exchange GBP£ when the rate is so disadvantageous gives you a great chance to enter the market while prices are still well down off their 2006 highs. That may not be the case at the end of 2017. Nevertheless, right now it is still possible to get a 20 year fix under 3%. And it doesn’t need to take a long time; it took only 12 days from initial enquiry to formal offer for clients of mine, who were in a competitive situation with other buyers, to be in a position to sign the purchase contract.


The What and Why of the Overseas Market
If you’ve read this far you’ll already know something of who is buying and where they are buying so now I’ll look at the what and why of the overseas market.

What are they buying?
The shift towards contemporary architecture, lots of glass and flat roofs, was just getting underway as the property market crashed but the trend has only accelerated as construction has started again. But every trend has a shelf life and I’m wondering if what was once seen as very futuristic and exclusive is now a bit overdone – at the end of 2016 I worked for clients who specified that they didn’t even want to look at ‘white boxes’, they wanted a house with an exterior that made some reference to a more traditional Spanish architectural style but with totally modern interiors. As the ‘white box’ look is now so ubiquitous at every level of the market I think I can just see the beginnings of move towards a more individualistic approach, at least at the top of the market and I think two new projects in Andaluca will stand out in 2017, rising above the rest.

The first is beautifully located in Cascadas de Camoján, just on the west edge of Marbella, with five houses priced between €5 and €7m, each with a different architectural style. A British funded development, it should start in early 2017 with completion before the end of 2018. But it’s what is happening in Sotogrande over the next few years that will really turn heads. La Reserva de Sotogrande will set new standards and will stand with the best on a global level. As well as individual villas priced from €2m there will be a small number of exceptional homes, known as The Seven, each designed by a different world-renowned architect, which will be among the finest properties in the world.

The property market is still heavily weighted towards resales, with about 82% of 2016 purchases being resales although that figure does include bank sales because the repossession was counted as the first sale, so a subsequent purchase by an end user is deemed a resale. Although building licence approvals are rising nationally there’s always a time-lag between project approval and it being sales-ready so I can’t foresee any substantial change in what people are buying in the short term. And the market is even more heavily weighted towards coastal properties than inland and in my view, the rural sector is no more now than a niche market for a very special kind of buyer. Long gone are the days when buyers priced off the coasts headed inland, not because they particularly wanted a rural property but because that’s all their budget allowed and I don’t see those days returning.

Marbella, which with Málaga city accounted for about half of all 2016 purchases in Málaga province, is in limbo following the September 2015 annulment of its planning laws, the PGOU. In the January to September period before the annulment 492 building licences had been approved but the 2016 number for the same Q1 – Q3 period was just 128, 78 for individual houses and 50 apartments. In contrast, Estepona had granted 457 licences by the end of September 2016. It’s not that the applications aren’t there it’s that the Marbella Town Hall has had to go back to the drawing board and projects waiting for approval are backing up. A developer colleague finally received the licence for a 3 villa project in Nueva Andalucía in December 2016, after an 18 month wait.

So, the market in 2016 was all about resales and that will still be the case in 2017 and, in my opinion, that’s the way it should be. The fact is that the best positions in prime locations have had property on them for years and my advice to my clients is that it makes better financial sense to go for a resale and not be deterred if it needs some updating or even, in the case of a detached house, tearing down, as building costs are still competitive. You almost certainly will have a finished product at a better price per square metre than new build and in the case of apartments and townhouses they will be more spacious and better located than new or recent builds. However, it is very clear that when new product is available overseas buyers are drawn to it like moths to a flame, even when it is overpriced, smaller and not in the best position, relative to resale property. It is an issue that I find inexplicable and I will cover later in the report when I discuss price trends.


The Why
For lifestyle Spain is hard to beat, relaxed and easy-going, safe and child-friendly. The climate suits all tastes, ranging from one of four seasons with a proper winter and lots of snow in the north to the sub-tropical south where the micro-climate zones on the Mediterranean coast of Andalucía have the best winter temperatures on the European mainland. Spain’s beaches and marinas have more Blue Flags than any other northern hemisphere country with a total of 679. For the cultural tourist Spain has 45 UNESCO World Heritage sites, putting it in third place globally, behind only Italy (51) and China (47). By region, Andalucía has the highest number with 7 and by 2018 it may be 8 as the Medina Azahara just outside Córdoba has been nominated as Spain’s next candidate for consideration.

Living well is affordable with food and drink prices below the E.U. average according to Eurostat and the cuisine is world-class. In the last 10 years a Spanish restaurant has been placed first in the list of the world’s top 50 restaurants 5 times and in 2016 Spain was the only country to have three restaurants ranked in the top 10. Sports and outdoor enthusiasts are spoilt for choice; golf, tennis, equestrianism, skiing, wind & kitesurfing, mountain biking, rock-climbing, hiking, fishing – the list goes on and on. The result is that Spain has a quality of life that’s hard to beat; the climate, the good food and outdoor lifestyle mean Spaniards have the longest life expectancy in Europe and are second worldwide, just behind the Japanese.

From an investment point of view, I believe prices in prime locations have regained about half of what was lost between 2008 and 2014, when, even in the best places, 40% was the average fall. So, in my view, there is still potential for capital growth of up to 20% in the relative short term before prices are back to where they were, from which point, no doubt, they will move on to new highs. Rental yields had another strong year in 2016. Across the board, owners of top-quality, luxuriously furnished properties in prime costal locations enjoyed 100% high season occupancy which is easy to understand given Spain’s phenomenal tourism figures in 2016, surging through the 70m barrier for the first time, closing the year on 75.3m visitors from overseas, way beyond even the most optimistic predictions and 10% up on 2015. According to the Tourism Ministry, 65% of Spain’s visitors stay in hotels, 35% d>on’t. Obviously, some of these will stay with family and friends and some will own their own property but that still leaves a very big number interested in renting privately. As a rough guide a 5%+ gross yield is achievable if all high season weeks are occupied by short term holiday lets and it will be similar in the case of a year-round long term rental.

The key to achieving an even higher yield is to focus on a mix of short term holiday lets and some longer lets at other times of the year in the few areas with a genuine 12-month season, and in the case of Spain that means heading for the mildest climate and golf.  And I don’t mean areas with one or two golf courses within 30 minutes, I mean the area that attracts the serious golfer between October and June, that is the Costa del Sol, which also markets itself as the Costa del Golf, and specifically, the prime stretch between Marbella and San Pedro.  A gross yield of 8%+ is achievable in this area, with about 5%+ coming in the high season weeks and the other 3%+ spread through the mid and low season weeks, mostly short term but there’s also demand for winter lets of up to three months. With demand outstripping the supply of quality rental properties in prime locations yields should hold up even though property prices are rising as rental prices are also on the increase and it goes without saying that free wifi, flat screen t.v. & satellite, high quality interiors and equipment are considered standard requirements by tenants.

When I am working for a client whose brief requires reliable rental income I target certain areas and ignore others, I look for a type of property and reject others.  Get the location wrong, even by just a few kilometres and income may be halved.  As well as pinpointing the right location in a particular area you need to be in the right region because some have legislated against short term holiday lettings, pressured by the powerful hotel lobby and disgruntled locals.  This is particularly true in city centres, such as Barcelona and Madrid where some localities are overrun with holiday lettings. So, if rental income is a requirement of your buying plan then check the legislation in that autonomous region because there are differences.

So, with prices still on the way up, excellent rental yield potential, both for the buy-to-let investor and non-resident owner, hard-to-beat quality of life, there are lots of reasons why overseas buyers are flocking to Spain in record numbers. But if you are one of those who are thinking that renting out your property when you are not using it makes good sense so it isn’t left empty for long periods and helps to cover running costs, the days of leaving a set of keys at the local bar and crossing fingers that no emergencies will arise are over – you need to be ‘rental ready’.


Are you Rental Ready?
In 2013 the central government in Madrid devolved responsibility for legislation to regulate rentals of various categories to the autonomous regions, a sensible move given the different demands and conditions of each region. Several had already moved in the direction of more control, most notably Cataluña and Valencia in the main tourist destinations, but most had not and many of those without a significant tourism sector still haven’t. Spain’s very powerful hotel lobby had been calling for stricter control of the private rental sector for years, arguing for a level playing field but in part, I suspect, the demands were driven by the underlying lack of competitiveness that still pervades much of the Spanish economy. As already mentioned, according to Ministry of Tourism figures, 65% of Spain’s overseas tourists stay in hotels but many of those hotels could stand improvement. Making it harder for individuals to rent privately would reduce the need for better standards and more competitiveness but, in my view, there is little crossover between the two sectors; if a customer looking for the flexibility and privacy of a rented property can’t find what they want in Spain I think they are more likely to switch to a private rental in France, Italy or Portugal than head for a Spanish hotel of indifferent quality.

In May 2016 Andalucía became the last of the main tourist destinations to legislate in respect of short term holiday lets. It is one of the biggest rental markets in Spain with the new registration system expected to uncover 80,000 properties offering a total of 400,000 beds. And, given its unique 12-month season, it is the region with the highest yield potential so I’ll cover some of the requirements in detail and although there are differences in how each region has legislated there are also many similarities so you can get the general idea of what is required. Firstly, there are different registries; rural properties were covered by a separate law already in existence and another law covered the rules in respect of three or more properties owned by the same person within a 1km radius. The 2016 Andalucía legislation, in common with laws already in place in other regions, affects the typical overseas property owner in Spain who rents when they are not in residence to short term holiday makers, the demographic that so irritates the Spanish hotel lobby. According to the hoteliers, they should all be staying in a Spanish hotel and they wanted to make it as difficult as possible for the private market. In many respects they got what they wanted.

Every property advertised for rent by the day, week or month via travel agencies, estate agencies, printed media, rental portals such as Airbnb and Homeaway, must apply for inclusion on the relevant registry. In some regions it’s done at the town hall while in others it’s direct with tourism authorities. Some regions charge a fee for registration, Galicia for example, but most don’t while Cataluña leaves it up to individual town halls to charge a fee if they wish. In Cantabria owners must also register with the tax authorities and I think it is safe to assume that all regions will make registration details available to tax offices. Cantabria also requires public liability insurance to be in place at the time of application. In Andalucía, registration is free and done direct with the tourism office in each of the eight provinces. Once the registration number has been issued it must appear in all advertising and on invoices and registration cards that tenants must complete on arrival. In some regions single rom occupancy is prohibited while the Andalucía decree covers only properties sleeping fewer than 15, more than that and it’s the hotel registry for you. Anyone renting to the same person for a period of more than two months can ignore everything as long term tenancies with a standard rental contract come under Spanish tenancy law.

Apart from the blindingly obvious requirements, such as pre-arrival cleaning and provision of clean bed sheets and spare linen, properties in Andalucía must have air conditioning between May and September and heating between October and April in all bedrooms and the living area. Freestanding appliances are not allowed so it’s goodbye to those radiators on wheels and wobbly cooling fans we are all familiar with. The obvious solution is wall-mounted split hot/cold units but I also like the slimline wall-mounted storage panels as very effective and low-cost background heating, particularly in bedrooms. All bedrooms must have external ventilation. Most owners who rent already have a visitor’s book but now they must also have a complaints book and a sign informing tenants that one is available.  Most owners already have an information file, with useful stuff about local facilities, maps, restaurants, points of interest and things to do and this can now be provided online which should be easier to keep complete and up to date. The nearest medical facilities, such as walk-in health centres, hospitals and pharmacies must be be noted and a first aid kit must be provided. There must also be a local contact number available 24/7.

The legislation allowed for a 12 month grace period for owners to bring their properties up to the required standard and inspections would start from May 2017 although, given the scale of the operation in Andalucía, it’s going to be a while before they get around to everyone. At the end of 2016, more than 10,000 applications for registration had been received, of which just over half had been issued with a registration number but remember, it is estimated that 80,000 were being rented privately when the law took effect. Some will drop out but there’s still a way to go.


And if you don’t bother
They will get you. Fines up to €90,000 have already been levied in Barcelona for persistent repeat offenders. The penalties for non-compliance in Andalucía range from written warnings to being struck off the register and fines go from €2,000 to €150,000, depending on the severity of the offence. And finding non-compliers is easy as the overwhelming majority of owners who rent their properties to tourists do so via portals such as Airbnb, Homeaway and Holiday Lettings. In August 2016 Barcelona Town Hall fined both Airbnb and Homeaway €30,000 for listing properties without a license number on their sites – about 40% of properties listed in Barcelona on these sites don’t have the required license. Homeaway paid up but Airbnb didn’t and appealed and in November 2016 both companies were fined another €600,000 each, for continuing to advertise unlicensed properties. I feel sure that other town halls will follow suit, particularly if angry local residents start to protest, as they are already doing in Barcelona and Madrid, that their neighbourhoods are being ruined by the growth of unlicensed tourist rentals.


Resale prices are one thing while prices for the very limited amount of new-build projects coming through in prime locations are quite another and I’m convinced many buyers entering this rising market are not doing the necessary research to ensure they are paying the right price for current market conditions. I maintain the most reliable way to do this in Spain is to look at prices per square metre in specific areas, it’s the only way to make a good comparison. I said earlier in the report that something very strange seems to come over international buyers when they see new projects, perhaps they are seduced by clever marketing but they can’t possibly be looking at the price per square metre because if they were they wouldn’t be paying what they are paying. It’s the only explanation I can offer for some of the bizarre price differences I noticed between resale and new-build properties during 2016.

Marbella was the first municipality on Spain’s Mediterranean coast to show prices rising, posting a 4.8% increase in Q1 2014, so there have now been 3 years of price growth and the first new projects started to come on stream at the same time. Immediately, there were buyers, almost exclusively from overseas, buying off-plan at more than double the price per square metre for larger and more luxurious resale properties in the same area. Even in 2015 a beachside new-build project in San Pedro de Alcántara was achieving over €4,000 per square metre and by 2016 prices in the last phase of the project had risen to over €6,000 per square metre. The project’s position was good, third line to the beach, but not particularly high quality finish, non-existent gardens and a tiny communal pool, right by the main road down to the beach. It sold out within months, with buyers ignoring much larger resale apartments in a frontline position 100 metres away, better quality materials, award-winning gardens and magnificent pool, a 24/7 concierge service, where it was possible to find asking prices equivalent to €3,000 per square metre. In every respect a better development but buyers went for a more expensive option of lower quality over one built in 2004 and the only reason I can come up with is the fact it was new. New may be nice but it isn’t worth paying double per sq. m. And it certainly doesn’t make financial sense because a property is only new once, it’s a resale in any subsequent sale and the asking price will need to relate to other resales.

And it’s getting worse. In 2016 the same developer marketed another project in the same area but further away from the beach, on a busy main road, nothing special about the internal finishes, small pool and no gardens to speak of and yet buyers were paying the equivalent of €9,000 per square metre, putting a penthouse overlooking a set of traffic lights over €1.2m. It sold. At the same time a duplex penthouse built in 2005 was on the market, more square metres, much closer to the beach, no traffic noise, lovely gardens and pool area and in Q4 2016 it was sold for a price equivalent to €2,800 per square metre. The buyers plan to completely renovate the apartment but even if they spray money at it they will finish up with a superior property in every respect for around €4,000 pm2. Personally, I cannot begin to imagine a scenario in which the buyer of the €9,000 per sq.m. apartment will ever see a profit. To put it in some context, when the bubble burst in 2008 the top price achievable in the Marbella municipality was €6000 – €7,000 per sq.m. and yet 2016 purchasers thought it was a good idea to pay up to 30% more than that, at a time when resale prices in the very best areas are still well below that peak level. In July 2016 a client of mine finished the renovation of a frontline golf apartment in Nueva Andalucía bought six months previously. Including the building costs the price per square metre came out at €2,365. Purchased as a buy-to-let investment the property immediately rented long term, representing a 5.5% gross yield Those figures make sense, €9,000 per sq.m. do not

It’s no different with new villas versus secondhand ones. There are several new projects coming through in the Marbella area for single individual houses or a group of several and, in most cases, they are selling off-plan. My calculations show prices per square metre for new build villas are running about double the resale figure. But if you take an aerial view of the Marbella area and realise how little raw land is left for development in the most prime locations the inevitable conclusion is that people are paying too high a price for new build in an inferior location. Compare the €3,750 per square metre clients of mine paid in December 2016 for a 5 bedroom house in a 1,710 sq.m. plot 250m from the beach in Cortijo Blanco, 10 minutes walk to San Pedro and Puerto Banús against the €5,500 per square metre being paid for 4 bedroom houses in 1,000 sq.m. plots up at the back of Nueva Andalucía, in an area dominated by apartment complexes, not other villas of similar quality. I find myself asking why would anyone spend €2.5m to be overlooked by properties of lesser value. Can it be that they really haven’t noticed that adjacent apartments will be able to see into the garden of their lovely new villa?

Although I use the example of Marbella the same reasoning can be applied to any region, assuming of course that there is a functioning market. You can only make price per square metre comparisons in those areas where the market has recovered, it doesn’t work if nothing is selling. So the assumption is that you are focused on a prime area as that’s where the activity is. Follow simple rules and you won’t make a mistake. Find out the resale price per square metre for the type of property you want in the location you want, based on actual sales not asking prices. As you move further away from the most prime locations reduce the price per sq.m. If you are considering a new property do the same calculation and compare the developer’s price with prime location resale prices and think twice if there is a huge difference. Never forget that your new property will be secondhand when you come to sell it and the fact that you paid double the going resale rate at the time won’t mean you can ramp up your asking price over and above what the market can stand.

Buyers entering the market now at the right price should expect substantial capital growth in the medium term, say 2 – 5 years but in the case of those paying inflated new-build prices, artificially inflated because of lack of stock, I’m not sure I can see them breaking even in the foreseeable future and some may never go into profit. But when it comes to resales in the very best positions buyers need to be aware that in many cases there will be more than one buyer chasing the same property, there is definitely competition in the market for quality in the right location. Having said that, there were also many substantial price reductions coming through in the last few months of 2016 and that was a signal to me that many vendors have become over-excited by signs of recovery and too ambitious with their asking prices.


I started my Spanish property market report by saying that much of it would not be that different when compared with what I had written a year earlier. And it turns out that my conclusions are also very similar, nothing much changed in the property market during 2016 and nor do I see much change ahead in 2017.

The issues that kept the domestic property market depressed in 2016, relative to the overseas sector, will still be factors throughout 2017; high unemployment, job insecurity among the employed, emigration of educated young people, an ageing and declining population, tight lending criteria, slower economic growth are just some. The issues that attracted record numbers of buyers to Spain from overseas in 2016 will continue to impact during 2017; Spanish property is still relatively affordable with substantial capital growth achievable in the medium term and excellent rental yields plus Spain is seen as a relatively safe and stable country when compared with some of the world’s trouble spots. There’s no doubt that Spain’s property and tourism markets have benefitted enormously from instability and insecurity elsewhere, and hopefully, that won’t change. If it doesn’t I predict international buyers will head for Spain in even higher numbers in 2017. In the meantime, the sun goes on shining, the food is fantastic and good value and the quality of life is one of the best in the world. What’s not to like?

I think the lack of high-quality inventory, both resale and new build, at the right price in the prime locations will continue to be an issue in 2017 and buyers need to have their wits about them to ensure they make a sound investment. When there are still an estimated 385,000 unsold units in Spain, many of which are of a quality and in locations that make them unsaleable, it’s hard to explain to potential buyers that there is a lack of quality inventory in the best locations. And when they do find the perfect property in the right location they may have competition. Clients of mine whose brief was for a beachside property in the Marbella area found themselves in a bidding war at the end of 2016. Even after they had agreed to pay the asking price the opposition kept on going, even calling the seller to ask just how much did they have to pay to secure the property. Fortunately, we had found a seller who once he had given his word, he stuck to it and my clients got the property. Just as well, because I wouldn’t expect to find another one at the price any time soon.

So my advice to buyers in 2017 is the same, not to obsess about new-builds, especially if they are not located in prime positions, and look at equivalent resales first, calculate the price per sq.m. to include any renovation if it’s needed, and then see what makes financial sense. The result will almost certainly be a lower price, a bigger property and, most important of all, a superior location. A thorough search can still uncover some real deals and although they are harder to find there will always be some sellers more motivated and realistic than others. Don’t buy anything that is blighted; roads tend to get busier over time so if it’s noisy now it will only get worse. If there is a mobile mast in view you can assume there will be more as the tendency is for them to mate and multiply. Electricity pylons are also a big no-no.

Read the marketing blurb carefully and be sceptical; there is a new development of five villas currently being marketed in Marbella and the ads highlight panoramic sea views, Golf Valley location, contemporary architecture, all true. But there’s no mention of what I think is the most important feature – that the site backs on to the AP7 motorway. Strange that and as I have no doubt that lots of planting has been done to screen the project I can easily imagine buyers not realising what is over the rear boundary until it’s too late. Make sure any property gets good winter sun and if there is vacant land nearby, which, if built on, would block a wonderful view then find out with absolute certainty what can be constructed. The selling agent saying it is green zone is just not good enough. When I am assessing properties for my clients I always ask the question: if circumstances change and they need to sell quickly and at a profit is the price right to enable them to do that and is this a property for which there will always be demand irrespective of market conditions? If we’ve learnt one thing from the shambles of recent years it is that there are properties and locations for which there will always be demand, irrespective of market conditions. It always has been, still is and always will be about location.
©Barbara Wood


 Spain - Golden Visa Spain With 500.000 euros investment.


Spain launched its gloden via programme in 2013. An investment of 500.000 euros in real estate will gain family residency. The spanish investor vosa can be renewed every two years and after five years it is possible to gain permanent reisdency and after ten years citizenship. It is not necessary to live in Spain in order to retain and renew the investor residency visa.


Key Facts :

- investments of 500.000 euros

- full family residency

- flexible. No requirement to reside

- Permanent residency from 5 years

- citizenship from 10 years

- EU Schengen visa travel


After several years of price declines real estate is now at rock bottom prices and the Spanish property market offers considerable potential for capital gains in the coming years. Investors need to consider their purchase carefully... Is it for investment and rental or lifestyle? There are many offers on the market from developers and banks but location and property type is critical to the success of the investment. 

Fab time to buy European property, as pound could rise later in 2016




Are you thinking of buying a property in Europe this year? If so, whether you’ve got your eye on luxury mansion in Cannes in the south of France, or a renovated apartment in Paris with 3 bedrooms, you may already know how advantageous a strong exchange rate is.


After all, if the pound sterling is standing tall versus the Eurozone’s common currency, this means you receive more euros when you transfer money to your European bank account, thus cutting the cost of buying European property. With this in mind, let’s see if the pound to euro exchange rate may rise in the 2nd half of this year!


The encouraging news for you is that sterling may fly higher versus the common currency later in 2016. This is because, following the UK’s decision to leave the European Union last week, Germany looks set to give favourable terms to the UK, which could lift Britain’s economy, and the pound.


For instance, just yesterday former German chancellor Helmut Kohl said that “shutting the door” on the UK would be a “big mistake.” Likewise, earlier this week French finance minister Michel Sapin conceded that “everything will be on the table” during the Brexit talks. And this could soon lift sterling!


So, let’s imagine that the UK secures a good deal from the EU, post-Brexit. In this case, sterling could strengthen from its current 1.20 versus the euro, up to 1.43, back where it was last November, before David Cameron announced the referendum date.


If this were to happen, you’d receive considerably more euros when you transfer money to your European bank account, to buy a European property! Whether you’re dreaming of buying a 5-bedroom mansion in Sotogrande, in the south of Spain, or even a house on a golf course in Sevilla, it could very soon become considerably less costly.


After all, just think what you could do with the extra euros, when the exchange rate to strengthen later in 2016. With more euros, you could pay off the real estate costs and legal fees of buying your dream European property. Alternatively, you could furniture for your new property, and decorate your home as you see fit. What’s more, if the pound to euro exchange rate rises sharply enough, you could even buy a more luxurious property than you’d originally had in mind.


Given all this, it's a fantastic time to buy a European property, as the pound may rise versus the euro later in 2016, as the UK negotiates a favourable Brexit deal with the EU!


By Peter Lavelle at foreign exchange broker Pure FX

Who is a property finder ?

Property Finders (or Property Search Agents as they are also known) are companies and individuals representing a buyer in a property transaction. The termis more common in the United Kingdom, but in the United States the situation is referred to as buyer brokerage, and in Australia it is known as Buyer Advocacy.

Property Finders specialize in sourcing and negotiating the purchase of property on behalf of the buyer. In essence, the Property Finder willdevelop an in-depth understanding of his client’s requirements, desires and property goals, and then attempt to find a property which matches all of these requirements for his client to acquire.

Property Finders/Buyers’ Agents originated in the United States during the early 1990s and have grown to become involved in over 67% of property transactions there. In recent years, stemmed primarily from the relocation industry, property finders now have a prominent involvement in property purchases across Europe, where it develops the market for the purchase of second homes in countries other than that of habitual residence.

The majority of property finders charge an engagement/retainer fee before they begin the search for a property.

For some, the appealis the time savings. Having the property findersearch out ideal properties keeps many buyers’ weekends free from scouring through website. Some firms offer evaluation services in addition to basic finding services; that is, properties are evaluated in terms of potential for capital gain and Rental Return, quality of location, potential for renovation or redevelopment, etc.

The benefits of local market knowledge and expertise have been found to be a key benefit of using a property finder.

Property finders are a particularly useful resource for buyers of overseas property, e.g. ski property or seaproperty. The advantages of using a property finder in a foreign country include: – an established network of local contacts – ‘on the ground’ representation – knowledge and understanding of the different tax and legal systems.

Your property finder for Europe (Spain, France, Italy, Poland, England... : European Property Finder Group - Contact us now :

Invest in Poland


Poland, officially known as the Republic of Poland is a country situated in the heart of Europe and is surrounded by countries such as Germany, Czech Republic and Slovakia. This strategic location has created a range of opportunities for the country as more and more investment is being drawn in the country from almost all the parts of the world. It is also one of the fastest growing economies in the entire Europe. It is growing at twice the rate as compared to other countries in the entire Western Europe.


Poland has been blessed by both renewable as well as non-renewable sources of energy. It also has huge sources of minerals and is also one of the largest producers of metals such as lead, copper, zinc and construction minerals. Just like its massive natural resources, Poland also has a state of the art infrastructure which really works in the advantage of the country. Poland has a good network of road and rails. It is the main link which joins the Eastern and Western European countries. A massive multi-lane limited access highway is being built all over Poland to increase the efficiency of the entire transport system in the country.

Apart from the abundant natural resources and an excellent infrastructure, it also boasts a highly qualified labor, political stability a good technological and telecommunications network. All these features really make it one of the most desired destinations for investment.


Poland is one of the fastest growing economies in the entire Europe. It was the only nation in the European Union to resist the 2009 recession. One important fact to note about Poland is it has never experienced a recession nor has its economy contracted since the late 2000s.


Poland was the only country in the European Union who did not succumb to the global financial turmoil and it is now going even stronger than ever. The World Bank has predicted that the Gross Domestic Product (GDP) of Poland is expected to grow at a rate of 4.1% in the year 2011. Thus, Poland is going to see a positive trend in its economy in the coming years

Market Size:

The market size of Poland is one of the biggest in the entire Europe. The 38-million consumer market really makes it easy for any investor to boost their business prospects in Poland. In fact, the entire size of the domestic market is considered to be the greatest advantage of Poland. The country’s strategic location also provides an easy access to other European countries and creates a market involving of 500 million consumers.

Growth figures and FDI figures:

As per the European Bank for Reconstruction and Development (EBRD), the Polish economy is expected to grow at a rate of 3.3 percent in 2010. The International Monetary Fund (IMF) has also forecast that the Polish economy is going to grow at a rate of 3.5 per cent in 2011. As per the National Bank of Poland, the foreign direct investment (FDI) in Poland in the year 2010 reached EUR 5 billion which was as many as 75% more than the corresponding period of 2009. The growth of this FDI was mostly due to the fact that the Polish investment agency was able to complete 29 new investments worth EUR 377 million.

Key investment areas:

The most prominent sectors worth investing in Poland, and which are showing signs of development, mainly include Healthcare and Life science research, Data search and analysis and Engineering and Design. It is in fact the hot spot for innovation. Other sectors worth investing in Poland include automotive, domestic appliances, Aviation, Electronics, Information Technology, Metals industry, Mechanical Industry and Renewable Energy.

FDI/Investment policy:

The Polish economy is one of the best economies to invest in for the foreign investors. This has mostly happened due to the investment friendly policies of the Polish government. The Polish legislations do not draw a line or discriminate between domestic and international investors and also allow the foreign investors to carry out their businesses in an effective manner. Foreign investors in Poland can transfer their profit operations even outside Poland with ease. The entire Polish market is open to foreign investors.

Special incentives offered by Polish government to investors:

The Polish government offers exciting incentives to investors depending on the type of investments. The Polish government provides attractive incentives to investors who invest in areas of unemployment. Currently, the aid rate which the Polish government provides investors to investing in areas where there are high levels of unemployment is 50%. For SME’s the Polish government provides an aid rate of 65%. The Polish government also offers incentives to investors in its R&D sector and these incentives can go up to even 100% subsidies.


The Polish government understands the importance of foreign investment and the subsequent development it brings and hence the Polish government has established an agency known as the PAIZ or the ‘Foreign investment agency’ which provides all the necessary information to foreign investors to set and flourish their business in Poland.

An investor friendly government, a state of the art infrastructure, a sustainable growth of economy and a regional leader- all these features really prove why Poland is one of the most attractive destinations to invest in the European Union. Its strategic location will really work in the favor of investors who want to expand their business all over Europe.

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Invest in France


France, officially known as the French Republic, is one of the major powers, economically as well as politically, not only in Europe but also in the entire world. Known for its exotic locations, France is even today a hot tourist destination. However, in the recent years it has been recognized as the one of the hottest destinations for investing. Thanks to the government policies.


France has now become ideal destination for investors who wish to expand their business overseas. Its commitment to free trade and various investor-friendly policies and a large market size in the entire Europe really makes it stand out from other countries not only in Europe but in the entire world. Situated in the heart of Europe, France really offers a huge advantage for investors looking to have a base in Europe.

France is not only investor friendly but is also taking all the corrective measures that will help increase the flow of foreign investment.



Apart from being the largest market in Europe, France also possesses some attractive features that investors cannot ignore. It has a pro-business environment and is completely open to the world. It also has a well established financial market and a highly skilled labour force. When it comes to ease in starting a business, France ranks third in the entire world.


Its highly sophisticated Science and Technology really makes it one of the most preferred destinations to do business in the entire world. It has a good Transportation and Infrastructure facilities that are conducive to carry out businesses in the country. France has a highly sophisticated transportation network including rail and road lines that connect France to other countries in Europe. It also has a good telecommunications network that provides all kinds of support that is needed for all sorts of transportation and communication.


The growth in the industrial output of France has really set an upward trend in its growth. As reported by the Bank of France, the French economy grew 0.4 percent in the third quarter and is expected to grow in the coming months of the year 2010.

Market Size:

With more than 65 million inhabitants, France is the second-largest market in the entire Europe. France not only has room for investment in some of the major sectors such as R&D, automotive, construction and biotechnology but there is also lots of scope for investments in research in green and clean technologies.

Growth figures and FDI figures:

France is the fifth largest economy in the world and has a Gross Domestic Product (GDP) of a staggering $2,490 billion. As far as the foreign investment is concerned, France also stands out from other countries. France received a whopping $117.5 billion of foreign investment thereby making it the most favorite destinations for foreign investment in the entire Europe. In terms of foreign investment, France alone has a market share of 23.3% with over 23,000 foreign companies already having a base in the country.

As many as 639 new foreign investment projects were set up in France alone in the year 2009. Out of these, 42 were in the R&D sector, thanks to the tax incentives provided by the government. This shows that France welcomes developmental investment and the French government provides all the necessary assistance that is needed to attract more foreign investment in the country.

Key investment areas worth investing in France:

There is lots of scope for investment in almost all the sectors in France. Some of the key sectors that are touching skies in France include automotive, Biotechnology, Software and Multimedia, telecommunications, Research and Development, Logistics and Computer Hardware & Peripherals. However, one key area where France really stands out from any other country in the entire world is the nuclear industry.

France is the market leader in generation of electricity through nuclear power. It derives as much as 79% of its electricity through nuclear energy. Considering the importance of clean energy in future, France has already taken steps in the right direction and has become a hotbed of investment in this particular sector.

FDI/Investment policy in France:

The year 2007 was very special for France as it underwent major reforms in its tax system, labour laws and corporate laws, all of which played a huge role in enhancing the overall business environment in the country. Labour laws have been amended and made more flexible and are made in view of providing more freedom to businesses. The French government has also introduced some tax cuts for productive investments starting from the year 2010. It has also simplified and modified its corporate law and is also giving more attention towards innovations. It is also performing a comprehensive research in simplifying the patent filing system and improving the tax credits.

Special incentives given by French government to boost foreign investment in France:
It is a kind of a rule in France that government encourages foreign investment in France and provides all the necessary incentives in all the forms to boost the inflow of foreign investment in the country. It provides loans, grants and special tax treatment for those who wish to invest in France.


Steps taken by French government to bolster foreign investment:


Considering the importance of foreign investment and the subsequent benefits it brings, The French government has also established various agencies that work to attract more foreign investment in the country. One of the major agencies that work in attracting foreign investment in France is the Invest in France Agency or (IFA). This agency is teamed up with various government departments in the French government in promoting the foreign investment in France.


The largest market in Europe, investor friendly policies and a free business environment, all these really make France one of the hottest destinations which investors today cannot overlook.


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Invest in Spain

Spain, officially known as the Kingdom of Spain is a key country member of the European Union. Spain is located on the south west of European Continent on the Iberian Peninsula. The mainland of Spain is surrounded by the Mediterranean Sea on the east and south coast. Spain shares in boundary with France and Andorra in the North and it shares its border with Portugal on the west. Traditionally, Spain is known for its historical and cultural heritage. The country has a rich cultural significance since several foreign cultures has had its influence in the Spanish land through out its history. The Spanish culture largely owes its origin in the Islamic, Latin, Roman Catholic and Iberian cultures.

The mainland of Spain is spread over 505,000 and it is one of the largest countries in the European Union. It is the second largest country in the Western Europe. The capital city of Spain is Madrid, other important countries in Spain includes Valencia, Seville and Barcelona. More than 41 million (approx) inhabitants reside in the country, making it the fifth most populated country in the European Union.


From the Economic view point Spain is a major player not only in the European Union but also at the Global stage. Spain’s economy is the ninth largest in the world and it ranks amongst the top 5 countries with huge economies in the European Union. Spain also is responsible for creating more than half of the new employment opportunities created in the European Union countries. Investing in starting a business in Spain, foreign investors can target reaching out and catering to the 44.7 million resident customers; foreign investors can take advantage of this huge market base. Foreign investors can also benefit from the Spanish governments aggressive foreign investment policies. It provides foreign investors free access to the modern infrastructure facilities. The foreign investors can also take advantage of the strategic geographic location of Spain, by having a well-planned and executed business plan foreign investor can easily embed into other markets within the European Union.


Growth figures and FDI:

Recently, the Economy of Spain has grown tremendously and it has become one of the most dynamic economies in the European Union. The Spanish government has adopted ambitious economic plans to make Spain a Global economic power house and attract foreign investment. Today, Spain has a huge GDP (Gross Domestic Product) that represents over € 980 billion (approx) and a Per capita GDP of $27, 914, which is higher than several European Countries. The Spanish economy is fast catching up the traditional super powers such as UK, US, Germany and Japan.


Over the past few years the economy of Spain has been growing consistently at about 4% per year. The growth rate is a substantial figure as compared to other economies in the European Union. Being a part of the Eurozone Spain has a very stable international currency; it is of the first countries that adopted use of Euros. The inflation rate in Spain remains as low as 3%, it has lowest inflation rates in the European Union. All these factors represent one of the most fertile environments for attracting foreign investors.

Key Investment Sectors in Spain:

The major contributing sector to the Spanish economy is the farming and agricultural sector however, recently the manufacturing (pharmaceuticals, technology and telecommunication) industry is also growing rapidly and is contributing towards to the Spanish economy. The service sectors including tourism and construction also constitute the pillars of the Spanish economy. Other important industries include clothing and footwear, manufacturing medical and construction equipments. Spain has a diverse and sophisticated market with plenty of opportunities for almost all the product selling in the European Union (EU) Nations.

Spain provides myriad of opportunities to foreign investors to invest in diverse sectors. In the current situation Spain offers very lucrative investment opportunities in the following sectors that promise tremendous growth potential.


Spain is one of the most beautiful places on the planet, the pleasant climate, the picturesque scenic valley; beautiful beaches attract huge tourism from around the globe. There are plenty of tourism related business opportunities for foreign investors. Foreign investors can invest in buying properties and making it available to tourists for accommodation purposes. Foreign investors can invest in building or buying hotels, cheap motels, luxurious beach side villas and B&B (Bed and Breakfast) facilities and rent it out to visiting tourists.

Real Estate:

In recent times, Spain has witnessed a rapid rise in the number of immigrants to the country, especially for the northern European countries. The health economy and the attractive life style of Spain have attracted immigrants. The influx of these huge immigrants and opened up new business avenues for foreign investors. Foreign investors can invest to cater to the needs of the foreigners by providing residential facilities, English Supermarkets, bedding shops, English bookstores, computer repair shops etc.

Food and Cuisine:

This is another tourism related business opportunity for foreign investors. Spain is known for its exotic cuisine. There are plenty of top notch restaurants in Spain that serves delicacies from around the world. Spanish people are avid food lovers and this opens up new business opportunities for foreign investors to invest in opening restaurants that serve both food and alcoholic beverages.

Besides these above mentioned business sectors foreign investors can also consider in investing in: business ventures in these sectors:

• Aeronautics
• Environment and water treatment
• Renewable Energy Sources
• Logistics
• Biotechnology
• Pharmaceuticals and Health Sciences


Incentives granted by Spanish government to foreign investors:
Some of the incentives offered by the Spanish government some of these include financial subsidies, tax exemptions, and real estate grants and so on.

Spain, is a world-class destination for investment, investors can be rest assured to earn valuable returns on their capital.


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The Many Joys of Living in Spain


If you are considering living in Spain, as with everywhere else, it’s a good idea to rent first. With a Short-Stay visa, you can stay in Spain as a tourist for 90 days out of every 180—a long enough stay to let you experience living in Spain without making a full commitment.


Stays under three months are generally listed as vacation rentals, and you will find plenty of these along the coasts and in major tourist cities in the interior—including the capital, Madrid, and Granada, in Andalucia.


Vacation rentals tend to be more expensive than full-time rentals—however, vacation rentals come fully furnished and generally include all utilities and fees. If you plan to come off-season or stay for several months, you can often negotiate a lower price than the listed per-day or per-week rate. For short-term rentals in smaller beach cities, expect to pay $700-$1,100 a month in rent for a small apartment off-season, while the rates in cities like Barcelona and Madrid can be double that.


If you do decide to live in Spain, you can choose between buying a property and renting. Long-term rentals are currently listing at attractively low prices for the quality available. In Alicante and Valencia, for instance, you can rent long-term starting at about $450 a month. Prices in Malaga start only a bit higher, though you’ll pay more the closer you get to Malaga’s historic center.


Away from the popular Costas, English isn’t as widely spoken as you might expect, even among realtors, though they will happily give you listings. Learning at least the basics of Spanish will make life easier, as all Spaniards speak it. However, do keep in mind that it isn’t the only language spoken in Spain. Most people in Catalonia, for instance, prefer to speak Catalan, the local language, rather than Spanish. Signs there don’t point to la playa (the beach). Instead, it’s la platja. Milky coffee isn’t café con leche, it’s café amb llet. And a street isn’t a calle–it’s a carrer. The same applies to the Basque country on Spain’s northern Atlantic coast, where many people speak Basque, and to Galicia, on the far northwest coast, where Gallego is spoken. To a lesser extent, you’ll find the same in Valencia and Alicante provinces, where many speak Valenciano.


To get the most out of Spain, you’ll need to make some changes to your lifestyle. Outside of the big cities, shops close for three-hour afternoon siestas (usually from 2 p.m. to 5 p.m.), and restaurants rarely cater to early eaters. In fact, Spaniards don’t usually have lunch until 2 p.m. or dinner before 9.30 p.m. While supermarkets are readily available, many Spaniards still like to shop at traditional markets when they have the time. Most major cities tend to have at least a mercado central (central market), while many have neighborhood markets, as well. Under its roof you’ll find individual stalls devoted to selling fruits and vegetables, meats and sausages, poultry and eggs, fish, or frutos secos (shops devoted to selling nuts, olives, dried fruits, and sometimes dried fish).


When bringing your belongings into Spain, household goods are duty free if you’re moving to live permanently. But if it’s a second residence, non-EU citizens are subject to duty on the value of the goods.


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Best countries to retire to in Europe :

Dreaming of a retirement spent sunbathing in St. Tropez, Sevilla, Marbella, or snorkeling near the Maltese islands? It may not be such an outlandish idea.

"These are all first-world countries with plenty of culture and amenities …"

These days, $1 buys about 0.91 euros, pretty close to parity compared with recent years. For instance, last year $1 got you about 0.74 euros. In 2008, $1 bought as little as 0.64 euros. Said another way, 7 years ago 1 euro was worth nearly $1.60. Now it's about $1.10.

"It's an exciting opportunity for Americans right now. Americans had written off Europe, and probably rightly so, when the euro was $1.50. It was expensive. And now Europe is not out of reach," says Kathleen Peddicord, publisher of Live and Invest Overseas.

A recent report by the website found that France, Italy, Spain, Malta and Portugal all have highly affordable places in which American retirees can comfortably settle.

"These are all first-world countries with plenty of culture and amenities, including excellent infrastructure and rich histories. Cost of living and real estate in many areas are affordable by U.S. standards," says Glynna Prentice, an editor for

Read more:…/best-countries-for-retirement-eur…

For your next house in Europe (Paris, St Tropez, Cannes, Sevilla, Marbella, Milan...), contact us :