As the investing giant Jesse Livermore once said, «The big money is not in the buying or the selling, but in the sitting.»
The past few years have been sobering for global property. Falling house prices have torpedoed buy-to-let markets all over the world. But an increasing number of people are still tempted by the dream of buying property in the sun, spending their holidays there and converting it into a nice little earner in their old age. There are a number of destinations where investing now looks far more attractive now that the general economy is on the rise once again. Some markets that nosedived – for example, Barcelona – show signs of bottoming out, and offer good value again.
An added attraction to foreign buyers is Spain’s decision to offer residency to non-EU citizens who invest €500,000 in the country.
Barcelona
Barcelona has great climate, is well connected with Europe and the world, and is very cosmopolitan.
The city of Barcelona is a thriving European business hub, with a large international workforce and a busy tourism industry, with luxury rental accommodation always in demand.
In the past few months, the first signs of a recovery – or at least a bottoming out – of Barcelona’s market have begun to appear. And of the 11 districts in Spain that saw price rises in 2014, nine were in central Barcelona.
The city attracted €1.32bn in commercial property investment in 2013, 116% more than the previous year.
Investing in “buy to let” properties is becoming a popular alternative for the individual investor who wishes to diversify their investment portfolio, or for those who just want to make a solid investment in real estate. Good rental income on the one hand and the constant increase in value of property on the other, makes “buy to let” properties a profitable business and smart investment.
According to Fitch ratings, the recovery in Spain will be at two speeds. In the coastal regions and on the outskirts of the big cities with large stocks of unsold homes it will remain weak, with the prices in these areas looking likely to stagnate next year while, in contrast, they predict that in the key areas of the big cities like Madrid and Barcelona, it is likely that the price increases will accelerate.
In the last year the average increase in value of residential properties in Barcelona’s Eixample district has been of around 4,3% and around 9,4% over the last 2 years compared to 5,5% and 2,3% respectively in Barcelona.
Residential rental prices in the Eixample increased around 6,5% between Q4/2013 and Q4/2014.
The expected return over a real estate investment in Barcelona from rental income is quite similar to the rest of Spain and represents around 5% over the net value of the property.
Eixample – Paseo de Gracia & Avenida Diagonal
Barcelona not only attracts large international companies that have either relocated or opened subsidiaries / offices here, it also increasingly attracts high end tourism, people with a taste for luxury, gastronomy and culture.
Eixample properties are so central that it is considered by many the heart of Barcelona; its impressive collection of modernist buildings makes it a very sought after property area.
The “golden triangle” is demarked by Paseo de Gracia, Avenida Diagonal and the Eixample izquierdo. Whilst the most exclusive boutiques are currently located on Paseo de Gracia, following its recent face-lift, Avenida Diagonal has increasingly been attracting and will continue to attract the world renowned luxury brands.
Paseo de Gracia, traditionally known as the Golden Mile, and Rambla de Catalunya, with their select international boutiques, prestigious offices and some of the best restaurants in Barcelona, culminate the offer of this district, excellently linked by public transport and just minutes’ walk from a wide range of tourist attractions.
Schwarz o & o Investment has worked in the luxury market for a number of years. We are proud of having completed several refurbishment projects; converting sometimes derelict apartments into luxury properties (visit our rental properties section to view some of our completed projects).
We find the best available buildings / apartments for sale and advise the client on the best areas for investment. We put together the design & refurbishment project and oversee the building work.
Once the building or apartment has been converted into a luxury residence, we manage the rental and / or sale of the properties on behalf of the investor.
Our aim is to make our tenants feel as comfortable as if they were at home by maintaining the highest standard of quality and service.
We arrange for legal advice, financing, consulting on red tape for non EU investors etc.
Schwarz o & o Investment also provides a hospitality service to cater for all of its clients’ needs during their stay in Barcelona.
More info: info@luxuryapartments-barcelona.com
(Logo Schwarz 0 & 0 – Real estate Investment)
