Investing in properties intended for holiday rentals has been a popular solution for years. For many, it’s an alternative way to invest capital, often turning into a primary source of income due to a satisfactory rate of return. More and more Poles are deciding to purchase apartments abroad in various attractive resorts, including Spain. What do you need to know when considering such an investment? What kind of properties are worth investing in?
1. Choose an attractive property location
It is worth investing in an apartment located in a popular tourist region that attracts tourists itself. In the case of Spain, Costa del Sol is a good choice – part of Andalusia, located in the southeastern part of the Iberian Peninsula. Great weather (the sun shines here for over 300 days a year), excellent cuisine, and vibrant culture attract crowds of tourists to this place. The international airport in Malaga with its extensive network of connections to various corners of the globe, as well as a well-developed road and motorway network, are also significant factors.
There are many resort towns in the stretch between Malaga and Marbella. Marbella itself attracts crowds of people seeking beautiful views and an excellent microclimate. There is no seasonality here either – as summer ends, the golf season begins. Even in winter, it is warm and pleasant here.
2. Check if short-term rentals are possible in your chosen location
Not every residential unit in Spain can be rented out. A property intended for rental must be registered in the Andalusian Tourism Registry (Registro de Turismo de Andalucía). It is crucial to verify if the property has a license before purchasing. This is an official document, issued by the City Hall, granting permission for tourist rentals and helping to avoid potential fines.
It is worth noting that homeowners’ associations (comunidades de propietarios) have a significant influence on the possibility of obtaining a tourist license. They may have their own regulations regarding short-term rentals. Therefore, when buying a property on the secondary market, it is advisable to check the community’s statutes (estatutos de la comunidad) and community resolutions (actas de la comunidad). This will inform you whether tourist rentals are permitted in the location you are considering.
What restrictions can communities impose?
If you use the services of an experienced agency, the verification of the tourist license will be their responsibility.
For new properties (i.e., from the primary market), the process of obtaining a tourist license can be simpler. This is partly due to the fact that new buildings often meet modern standards (e.g., energy efficiency, building codes) and legal requirements. Importantly, in new properties, homeowners’ associations may not yet have established regulations regarding short-term rentals.
3. Plan the management of your holiday apartment
Are you already a property owner and wondering how to approach rentals? Partnering with an agency is a good and convenient solution for investors.
Most often, owners settle with the agency by paying a certain percentage of rental income. In return, the agency handles tenant communication, room maintenance, contract agreements, and more. This solution provides you with peace of mind, convenience, and security, ensuring your property is professionally managed and generates a steady income.
4. Protect yourself against dishonest tenants
When deciding to buy an apartment for rent in Spain, it is advisable to choose a guarded complex. This will ensure security and prevent unwanted guests (so-called okupas) on the property. Well-drafted contracts (especially for long-term rentals – again, cooperation with a real estate agency will be beneficial here) will also be helpful. An additional form of protection is purchasing insurance against “okupas“.
5. Take advantage of Spanish bank offers
Investing in holiday apartments in Spain is more accessible than you might think. Spanish banks readily grant mortgages, including to non-residents, which is particularly important for foreign investors.
They offer loans that can cover up to 70% of the property value. This means investors only need to have 30% of the property value as a down payment. Remember to factor in 10-13% for so-called transaction costs, which are not covered by the bank (their amount depends on whether it is a property from the primary or secondary market). This significantly simplifies the purchase process, especially for those just starting their journey with investing in foreign real estate.
Currently, mortgage conditions in Spain are very attractive. Mortgage interest rates are low, and loan terms can be flexible and tailored to the borrower’s individual needs. Mortgage terms for potential property owners in Spain are often more favorable than in Poland, making the Spanish real estate market even more appealing. Furthermore, for short-term rentals, mortgage interest can be deducted from taxes in Spain, as it constitutes a cost of acquiring revenue.
6. Trust experienced professionals in the holiday property market
If you are planning to purchase an investment property in Spain, it is worthwhile to leverage the knowledge and experience of local real estate agencies, such as International Investment Marbella. We are the oldest Polish real estate agency, and moreover, a family business operating in Marbella, Spain, for over 20 years.
We offer expert knowledge of the local real estate market, and we will help you find the ideal location for both living and tourist rentals, completely commission-free. Our offer includes properties from both the primary and secondary markets, as well as a wide range of after-sales services, such as:
