Spain sees boost in rental demand
Figures nearly double in the last 5 years
Research has shown that popularity in the private rental sector in Spain has doubled in the last five years.
New data shows the number of long term tenants has risen to 16.6% compared to figures of just 7% five years ago. The average price of rental properties in Spain rose almost 3% during first quarter of 2015, which was reportedly the first rent increase that the country has seen in seven years.
As a result of the slowdown in house prices that previously occurred across Europe, many residents turned to long term renting as a more affordable solution. Even as sales have continued to improve across the country, many tenants have opted for staying in their rented accommodation on a more permanent basis.
Currently, a standard one bed apartment in a central tourist location will have a monthly rent of approximately €700 and figures released this week show that average yields are around 7.6% for long term lets.
The report is positive news for buy to let investors as the pound against the euro is currently at its highest level in seven years.
comments from sequre
Sequre’s Managing Director, Graham Davidson, commented on the Spanish rental demand:
“The increased rental demand that Spain is currently experiencing purely adds to the boom of the European housing market we’re seeing at the moment. It’s very likely that tenants in long term lets have steady jobs and a good income so there is no real need to leave their rented properties, especially if they are centred in prime, tourist locations such as Costa Blanca and Costa Del Sol. In fact, with employability so high in these areas, demand could increase further throughout the year.”
“Overall, the Spanish property market is continuing to go from strength to strength and, as a result, investors are looking here for buy to let. It’s ideal for them to be able to achieve good yields and capital appreciation, which then allows them to build a nest egg for the future. Plus, they get the added option of owning a holiday home which can be utilised later in life. The current exchange rate offers a great deal for investors, but these have been known to fluctuate so those wanting to avoid disappointment might want to act now in order to get a good deal on a Spanish property.”
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