Words by Raymundo Larraín Nesbitt
RENTALS in Spain have climbed for the fifth consecutive year.
The country has smashed its own records seeing rental prices climb 5.1% in 2019.
But that’s not all, the price per square metre has reached unprecedented levels since 2007! Rental yields have soared over the past five years, equating to a substantial 50% increase.
The average annual rental yield in Spain now equates to 5% of property value.
Buy-To-Let in Spain has proven a very successful investment for savvy investors.
Scores of landlords make large amounts every tax quarter and you can expect to rent out nine months a year as a holiday rental, with huge landlord tax breaks of 70%, or more, on (rental) income tax.
This lenient tax relief also extends to non-resident landlords.
The income can also be used to offset overheads and maintenance expenses, including mortgage repayments.
Pretty much, no other investment is giving a 5% yield per year as safe as this one.
But that’s not all, it only gets better!
Besides soaring rental yields, you also need to factor in the capital appreciation of the property (the increase in value of real estate over time).
Properties in Spain have seen their value increase over the previous five years at an average rate of 5% per year, according to Moody’s.
Pro-tip: When you combine both soaring rental yields and capital appreciation, you reach the conclusion that Spanish real estate is giving a safe two-digit return.
In plain English, that’s over a 10% yield every year safely, ideal for retirees who are afraid of sharp stock market fluctuations and seek a safe investment in bricks for their pension pot.
At Larraín Nesbitt Lawyers we can represent you buying properties and dealing with their non-resident taxation.
We can also put you in touch with other reputed professionals that will assist you to choose and make the most out of your property portfolio and maximise your return on investment.
Visit www.larrainnesbittabogados.com for more information