The luxury property market in Spain has been attracting plenty of investors from overseas. Investment funds and individual investors alike are looking to acquire some truly wonderful properties at significantly discounted prices. Independent homes as well as luxury apartments in many of the sought-after regions in the country are being offered to foreigners at discounts of twenty per cent as the economy finds it hard to recover from the financial crisis that has been threatening the nation for over five years now.
There are many reasons as to why a large number of potential investors consider Spain as their dream destination. Firstly, the climate in Spain is simply ideal for a relaxed and laidback lifestyle. In addition, alterations to government policies have made it possible for investors to acquire properties worth more than 500,000 Euros and attain a residency permit along with the acquisition.
Market insiders report that almost 85 per cent of the people who are investing in Spain hail from abroad and are purchasing real estate assets for cash. The other fifteen per cent acquire properties through mortgages owing to tax reasons.
Coastal Areas Performing Well
While the centrally situated cities and towns are not performing at the high levels that governed the market prior to the recession, the Mediterranean Islands and properties on the Costa del Sol seem to be raising the pace in terms of sales. Majorca and Ibiza – the two Mediterranean Islands are experiencing a good amount of sales, as is Puerto Banus in the southwest of the country.
According to real estate agents in the country, most of the investment in Spain’s real estate market is courtesy of foreigners who are looking for a home in the sun. Locals are unable to purchase properties because they are still recuperating from the harsh effects of the financial crisis. Some locals who have the money to purchase homes are sceptical about their investments, and their cautious attitude is not helping the market in the least.
Foreign Interest in Spanish Properties
Spanish properties are attracting interest primarily from outside the Eurozone. Buyers from countries such as the United States, Colombia, Venezuela, Mexico, and other Spanish-speaking countries form the majority of the buying population. People from Ireland and England who had set their sights on Spanish properties in search of a fine holiday home have withdrawn their interest in recent times.
The main reason for the reduction of interest in Spanish properties from Britons is the Spanish economy which has failed to recover from the economic crisis that made its mark in 2008, leading potential investors to believe that their investments will be risky.
The construction boom promised to take the Spanish economy to new heights, but its collapse has left the nation reeling as over a million properties are now on the books of local banks, waiting to be sold. Although the crisis has dampened the spirits of investors, investment funds are enabling the purchase of many of these properties and helping the economy raise the funds necessary for sustenance.
Written by Les Calvert
