The real estate sector has always been one of the most attractive investment options for people interested in generating a stream of passive income and obtaining a long-term return on investment. However, the decision should not be taken lightly. To do this, we propose five tips that will help you guide your search and make the right decision.
- Define your objectives: Are you looking for a property exclusively for the purpose of renting it out? Do you want to use it yourself and rent it as well? Defining this is of vital importance because the search criteria can be substantially modified, especially if you wish to give it a double purpose.
- Assess the price of the home and its potential: When choosing to purchase a home, it is extremely important to perform the expected profitability calculations. For this, the investment made, the fixed and variable expenses including taxes, the type of rental that you will perform (holiday or long-stay), and the expected occupancy percentage must be taken into account.
- Analyze the supply and demand in the area: As a basis, we start from the premise that, when choosing an area, it should have at least 50,000 inhabitants. Then you can use rental search platforms to analyze the offer in the area and the predominant type of housing. This last point is based on the idea that the investor could look for a house with characteristics that differentiate it from the rest.
- Location: Close to the sea? To big cities? To golf courses? Many times, people tend to think that the ideal is to acquire a home close to the beach and tourist spots; however, there are other options to consider, such as golf courses. In Spain, golf tourism has become one of the most interesting points to take into account, mainly after the pandemic, when outdoor activities were revalued. On the other hand, the climate on the Costa Blanca and Costa Cálida ensures that the season is extended, being able to practice the sport in practically all seasons.
- Financing: Investigating the possibility of obtaining financing is another interesting point to consider. Spanish banks offer financing for both residents and non-residents at extremely attractive rates, and with the possibility of acquiring up to 70% of the value of the home.
- Review the physical state of the property: To do so, we recommend hiring a professional, such as an architect, to inspect the state of the facilities, and evaluate the necessary reforms if necessary. The cost of this inspection service is approximately 100 euros.
- Consider the management of the property: Decide if you want to take care of it yourself, or if you want to hand over the management of it to a company.
In this way, you will ensure that you obtain the multiple benefits of investing in real estate, minimizing risks as much as possible.
RO Spain provides advice on all these points, as well as professionals for real estate inspection, mortgage loan application management, and property management once acquired. That is why perhaps the most important advice is to choose a trusted real estate agency that can accompany the process at all times and solve all the doubts that the client may have.