London Archives - How to buy in Spain

Remote working from your Madrid’s pied-à-terre?

STEPHANE — Thu, 25 Aug 2022 12:51:41 +0000

Click on any flag to get an automatic translation from Google translate. Some news could have an original translation here: News Nouvelles Nieuws Noticias Nachrichten

A pied-à-terre in Madrid

Profile of the buyer

a lady residing in the USA, with her son living in Spain (not in Madrid).

Yes indeed, another buyer benefiting from the 20% loss of the Euro against de dollar during the last year.

The objective of this real estate investment?

to buy a small apartment in Madrid to be used by her son on weekends, and by herself when she came to visit. She did not want to do any kind of renovations. So, not really a remote working spot but we could consider it as one.

In which neighbourhood should you buy an investment property in Madrid?

she wanted a neighbourhood that had lots of small shops and “neighbourhood life” but that wasn’t too touristy or expensive. It had to be well connected to the airport and to the centre. We recommended several options, and she chose to focus on Plaza de Castilla and Prosperidad.

The perfect jewel property found in Madrid

a bright, just-renovated studio apartment on a relatively quiet street in Prosperidad, two blocks away from the subway and 9 minutes walking to Avenida de América (a major transportation hub).

Special considerations for this property search

An initial challenge was that she was going to spend only a few days in Madrid to view properties, so we did thorough prep work to filter and view properties prior to her arrival, to narrow down the shortlisted properties to only the best ones. Also, the property she finally selected had formerly been a shop and was still in the process of being inscribed in the Property Registry as a residence. We negotiated a deal by which she would pay a small deposit to the seller, and then pay a monthly “rental” fee that would be fully deducted from the purchase price once it got properly registered and the deeds could be signed. This way she didn’t run the risk of buying a property with a legal inconsistency but still had the benefit of using it right away.

Is the Madrid property market already at sky-high prices?

Madrid offers some of the best returns in Europe. The entry price is extremely low, and average returns on Madrid property investment are some of the best in Europe- particularly among leading capital cities.

If you want to know more on that subject, have a look at our article: “What return will you make on your Spanish property?”

About Agnes and her team, our Property hunter in Madrid.

We help clients locate, purchase and renovate property in Madrid. Get in touch today if you’d like to learn how we can help you invest in Madrid.

Send your request to our property hunter in Madrid, or follow the link if you are looking for a property hunter anywhere else in Spain. Ask us directly and benefit from the strength of our network!

Check the full profile of Agnes, our local partner, Property Hunter in Madrid

The post Remote working from your Madrid’s pied-à-terre? appeared first on How to buy in Spain.

A Madrid buy-to-let property investment

STEPHANE — Thu, 25 Aug 2022 10:39:38 +0000

Click on any flag to get an automatic translation from Google translate. Some news could have an original translation here: News Nouvelles Nieuws Noticias Nachrichten

A low-maintenance rental property in Madrid

Profile of the buyer

a single mother from France, residing in Madrid

Goal of this real estate investment?

She wanted to invest her savings in the real estate market in Madrid, but with a full-time job and a baby she had neither the time nor the knowledge to make a safe, profitable purchase.

Her goal was an apartment she could rent out long-term that would give her the least amount of trouble and would gain value with time. Hands-off management and long-term capital gains were more important than obtaining the highest possible rental yield.

A small budget for this buy-to-let property in Madrid

The total investment (including taxes, fees, renovations, etc.) budget for this apartment was 200,000 to 220,000€ with no mortgage.

This budget is really on the low end of the current market in Madrid.

In which neighbourhood should you buy an investment property in Madrid?

We considered and analysed several neighbourhoods, but due to a combination of proximity to her home, property prices and trends, plus profitability, we focused mainly on the Puerta del Ángel neighbourhood. It’s an area that’s very close to the centre, but just outside of the M30 ring road.

The perfect investment property in Madrid?

After a month and a half of viewing and analysing properties, we found a completely off-market apartment through personal contacts. The apartment had a perfect combination of attractive features for a rental, a superb location right next to the subway, and the right price. The only caveat was that it needed to be upgraded and modernised. The client didn’t have the time or desire to deal with renovations, so we took care of this part as well, requesting and comparing budgets from contractors, and supervising the works. In the end, we handed her the apartment with the tenant already selected and a rental price above expectations.

Let’s check the investment return

Total investment was 223,500€,
The rental price was 900€ /month.
Gross ROI 4.83%, net ROI 4.15%.
Duration of the project: from start to finish it took us 5 months.

Would renovation add any value?

In this case, there were minor renovation works. If you are able to buy a property at a discount price because it needs some renovation, most of the time, it will be the best investment you could do as renovation works in Spain are not too expensive. Our property hunters do manage those works and we do have teams of renovation workers nearly in all major cities in Spain.

Is the Madrid property market too expensive in 2022?

Are real estate returns interesting in Madrid vs. other major European cities?

According to Deloitte. Check the rental Yields for the major European Cities, Madrid and Barcelona have rental yields close to 5%.

If you want to read more on real estate investments in Spain, read our article we wrote a few weeks ago: What is the return on your Spanish property investment?… Above 10% according to the bank of Spain (as of May 2022).

Madrid is the 3rd biggest city in Europe in terms of size…

Although Madrid property prices rose in 2017, there is still much room for appreciation. Prices are still 54% off their peaks of mid-2007.

Madrid is the 11th City in Europe in terms of price/m²

But check on the above chart, the price/m² in London are 16.500€/m² and 12.500€/m² in Paris… while Madrid is at 3.500€/m².

Yes, less than one-quarter and one-third of the price of London and Paris. Period.

At the same time, rents are about 50% lower at 14€/m² vs 28-29 €/m² in Paris and London…

Madrid has a rental yield 2x bigger than other major European cities

Now, yes, you see why the return in Madrid is nearly twice as high as the one in Paris and London. Do you think that the price risk is higher in Madrid than in Paris and London?

Source: Deloitte property Index 2021, Overview of the European Residential Market

About Agnes and her team, our Property hunter in Madrid.

We help clients locate, purchase and renovate property in Madrid. Get in touch today if you’d like to learn how we can help you invest in Madrid.

Send your request to our property hunter in Madrid, or follow the link if you are looking for a property hunter anywhere else in Spain. Ask us directly and benefit from the strength of our network!

Check the full profile of Agnes, our local partner, Property Hunter in Madrid

The post A Madrid buy-to-let property investment appeared first on How to buy in Spain.

Americans are buying real estate in Madrid at a 20% discount!

STEPHANE — Thu, 25 Aug 2022 08:43:58 +0000

Click on any flag to get an automatic translation from Google translate. Some news could have an original translation here: News Nouvelles Nieuws Noticias Nachrichten

Buying two homes remotely in Madrid

Yes, with the Euro trading close to its lowest level ever, which is about 1, we see many real estate investors coming from America as the euro lost about 20% over the last year.

Have a quick look at the EUR evolution over the last 5 years

On this chart, we check the evolution of any currency vs its level on the 1st of January 2021 (which we give a 100 value). So, if you see a value lower than 1 today, it means that the Euro weakened in the meantime. If the value is higher than 1, it means that the Euro strengthened.

Profile of the buyer

mother and son, both residing in USA.

Why Madrid is the perfect city for foreigners?

they both wanted to move to Madrid, and wanted to buy two apartments, one for each; the combination of the two would allow them to obtain the Golden Visa. The mother was in a wheelchair, so both properties had to be handicapped-accessible.

A nice budget for this real estate project in Madrid

total for both properties, including everything, 800,000€

Where in Madrid?

the greatest difficulty was finding apartments that were –or could be made- accessible. After a month viewing and analysing properties, they decided on two ground-floor apartments, one in Tirso de Molina and another very close to Plaza de España. One was in good shape but needed to be adapted to the mother’s needs, and the other was totally dilapidated by careless tenants. So we helped them with finding and selecting the right contractors for the jobs, and are currently supervising the works.

Some special considerations to take into account for this property search

due to personal circumstances, neither of them could travel to Madrid during the purchasing process, and are also not here in Madrid during the renovations. We helped them select the properties remotely by connecting as many times as necessary through video calls and making lots of very detailed videos and reports of the properties. During the renovation process, we are handling all issues as they arise, and sending regular status updates.

Length of this property hunting from start to finish

expected move-in date is end of September 2022, with a total duration of 6 months for the search, purchase, and renovations.

Renovation?

In this case, there were some renovations. If you are able to buy a property at a discount price because it needs some renovation, most of the time, it will be the best investment you could do as renovation works in Spain are not too expensive. Our property hunters do manage those works and we do have teams of renovation workers nearly in all major cities in Spain.

Is it too late to buy in Madrid?

If you want to know more on that subject, have a look at our article: “What return will you make on your Spanish property?”

About Agnes and her team, our Property hunter in Madrid.

We help clients locate, purchase and renovate property in Madrid. Get in touch today if you’d like to learn how we can help you invest in Madrid.

Send your request to our property hunter in Madrid, or follow the link if you are looking for a property hunter anywhere else in Spain. Ask us directly and benefit from the strength of our network!

Check the full profile of Agnes, our local partner, Property Hunter in Madrid

The post Americans are buying real estate in Madrid at a 20% discount! appeared first on How to buy in Spain.

Madrid property investment: a Case study

STEPHANE — Thu, 01 Feb 2018 06:09:57 +0000

Click on any flag to get an automatic translation from Google translate. Some news could have an original translation here: News Nouvelles Nieuws Noticias Nachrichten

Madrid property investment: a Case study

Purchasing a “fixer-upper” and renovating it is one of the best ways to make money in property investing. This is particularly true in a city like Madrid, where the housing stock is old. This article explains why Madrid is such a good city for property investment, then shows a case study from one of Brian past clients.

Madrid is in the sweet spot for property investment

Madrid and Barcelona are the top 2 main European cities in term of yields

according to Deloitte. Check the rental Yields for the major European Cities, Madrid and Barcelona have rental yields close to 5%.

If you want to read more on real estate investments in Spain, read our article we wrote a few weeks ago: What is the return on your Spanish property investment in 2018?… 10.9% according to the bank of Spain.

Madrid is the 3rd biggest city in Europe in terms of size…

Although Madrid property prices rose in 2017, there is still much room for appreciation. Prices are still 54% off their peaks of mid-2007.

Madrid is the 11th City in Europe in terms of price/m²

But check on the above chart, the price/m² in London are 16.500€/m² and 12.500€/m² in Paris… while Madrid is at 3.500€/m².

Yes, less than one-quarter and one-third of the price of London and Paris. Period.

At the same time, rents are about 50% lower at 14€/m² vs 28-29 €/m² in Paris and London…

Madrid has a rental yield 2x bigger than in Paris and London!

Now yes, you see why the return in Madrid is nearly twice as high as the one in Paris and London. Do you think that the price risk is higher in Madrid than in Paris and London?

Source: Deloitte property Index 2017, Overview of the European Residential Market

Moreover, Spain has some of the highest economic growth prospects in Europe. Remember, GDP growth in Spain is one of the biggest in Europe in 2018 as foreseen by the European Commission… Check our interactive chart (click on any country)

This, combined with efforts the Madrid Government has taken to build the city’s infrastructure and attract direct investment, augurs extremely well for property prices according to the team of Brian, our Property hunter in Madrid.

The icing on the cake? It could be Brexit. As businesses move out of London, many are choosing Madrid. In fact, The Guardian recently published an article detailing how the city stands to benefit from Brexit.

The benefits of apartment renovation

Being a successful property owner boils down to one thing: maximizing your rental yield. One of the easiest ways to do this is to buy a property relatively cheaply and refurbish it to improve its value. This is true in any market, but particularly so in Madrid.

The typical Madrid apartment is in an old building. Historically, they were divided into many small rooms and were often dark and rather forbidding. The city has been late to the game, compared with other European capital cities, in embracing the light-filled, open spaces that are so popular nowadays. Moreover, most Madrid apartments contain very old appliances- most lack dishwashers and dryers. Bathrooms rarely have modern showers and often lack the water pressure and/or boiler capacity for a proper bath.

Corporate clients and wealthier tenants prefer refurbished properties with modern conveniences such as dishwashers, microwaves and even wine refrigerators. Luxury and convenience rule the day. To meet these needs, one needs to do a full renovation. In the long-run, the money and time invested are well worth it.
In short, we have found that every additional 1€ our clients spend on refurbishment add an additional 1.5€ to the value of their apartment.

Case study: Calle de la Palma

This is typical of a renovation we managed for a client. The apartment is on Calle de la Palma, situated in the trendy neighbourhood of Malasaña. The street is a small side street, directly off the thoroughfare Calle de San Bernardo. Like many streets in old Madrid, it is narrow, lined with yellow and pink buildings trimmed in white. Houses are festooned with old gas lights and iron balconies- it is particularly evocative at sunset.

Relatively quiet at night, it has a number of excellent places to enjoy tapas. Bodegas el Maño, founded in 1927, is a traditional old bodega (wine shop) where you can still enjoy a glass of their speciality, wine from Zaragoza. Or if you like the new and fashionable, you can get a glass of wine and tapas at the sleek, sexy La Loca Juana. At the end of Calle de la Palma is the atmospheric Plaza de las Comendadoras. Here you will find a number of outdoor terraces and modern restaurants, such as Federal and Roll, mixed with traditional Spanish fare.

The renovation

This is what we call a “lifestyle renovation.” Our clients wanted a property they could use as a vacation home, but also rent for profit. After much looking, we found this property for them. Their total investment was 358,000€.

The apartment was a typical Madrid property- dark and forbidding with very few modern conveniences. Here is a before photo:

As you can see, the drop ceilings were very low, creating a hovel like effect

We opened up the drop ceiling to reveal the beautiful old wooden beams. We opened up walls, enabling the light and energy to flow freely through space. The kitchen and baths were re-tiled, although we retained some of the old touches to supply a bit of old-style Spanish flair. All appliances were modernized. Here is the final result:

The living room with opened up walls, enabling the light and energy to flow freely through space.

The kitchen was completely renovated, in a style which appeals to higher-end renters.

Old plumbing was replaced with modern sinks, toilets and showers. We let as much light into the apartment as possible.

We added luxurious touches to the Master Bedroom.

The smaller bedrooms let the light in and maximize the number of Airbnb guests.

Overall return

After five years their total overall returns, based upon a total initial investment of 358,000€, were as follows:

Total investment	358,000€
Gross rental return	9.7%
Net rental return	6.0%
Gross return in 5 years	69%
Net return in 5 years	46%

Read the September 2018 update from Brian on the Madrid real estate market: Madrid real estate prices are up 21%: Is this sustainable?

If you are looking to buy in Spain, we would suggest that you read our earlier paper on Property hunting: 6 essential reasons for loving your Spanish real estate shopper. This paper is very interesting and gives you some of the important reasons why working with a property hunter is very useful for foreigners looking to buy in Spain. You will find specific samples our independent local partners worked on in Alicante, Valencia, Barcelona and Madrid. If you are looking to buy a property in Barcelona, read our Barcelona “Case study” article of May 2018.

About Brian and his team, our Property hunter in Madrid.

We help clients locate, purchase and renovate property in Madrid. We also serve as a full-time property manager for those who wish to let their properties. We have a large portfolio of actively managed properties and have helped over three hundred clients find their dream homes and investments. Get in touch today if you’d like to learn how we can help you invest in Madrid.

Send your request to our property hunter in Madrid, or follow the link if you are looking for a property hunter anywhere else in Spain. Ask us directly and benefit from the strength of our network!

Check the full profile of Brian, o ur local partner, Property Hunter in Madrid

The post Madrid property investment: a Case study appeared first on How to buy in Spain.

Madrid on the top 3 list of European Cities to invest in

STEPHANE — Fri, 31 Mar 2017 17:06:35 +0000

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Madrid is the third most attractive city in Europe, the Middle East and Africa (EMEA) to invest in real estate.

At least this is clear from the survey “Global Investors Intentions 2017” conducted among 2,000 international investors by CBRE, the first international consulting and real estate services company.

According to Paloma Relinque, Director of Investment CBRE Spain Madrid is an attractive city for international investors because of several factors:

Prices are still below that of other markets
in recent years interesting rehabilitation and development projects have begun
forecast of income growth

According to the study, London leads the list of the most attractive cities to invest in real estate, chosen by 17% of investors, followed by Berlin (15.8%) and Madrid (8.4%). They complete the top five posts Amsterdam and Paris.

To have an access to the report, register here or you can check the official press release in Spanish here.

Looking for an expert in Spain? Ask us directly!

Stéphane

Senior analyst and strategist at HTBIS

Check the full HTBIS team here

The post Madrid on the top 3 list of European Cities to invest in appeared first on How to buy in Spain.

Why not starting up in a Spanish City?

STEPHANE — Mon, 13 Feb 2017 16:36:50 +0000

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Barcelona and Madrid in the European top 6!

According to the site EU-Startups, Spain is the only country with two cities in the top 10 in Europe. Those cities are Barcelona (5°) and Madrid (6°). So starting up in Spain could be one option to consider, should you want to find a good city in Europe.

Low cost of living

The most attractive features for investors and entrepreneurs in Spain are probably the relatively low cost of living compared to other European countries.(10% in average), check

Costs are on average 10% lower than in other European countries, check our post on that.

Incubators and Accelerators

The great amount of incubators and accelerators that are established in the country, which is in a relation of less than 10 startup per incubator or accelerator.

Strong Education level

One of the main characteristics of the Spanish startup ecosystem is the great educational level of entrepreneurs and workers. If you combined that to the easy-access of international markets, it makes it so attractive that even Google opened a Campus Madrid in 2015 .

International & Venture Capital interests

During that year (2015) roughly 400 million € from Venture Capitals were invested in startups creating approximately 1.500 jobs . In addition to that, the “Instituto de Crédito Oficial” raised the FOND-ICO (fund of funds) from 1,2 to 1,5 billion €. That will help the revitalization of the risk capital sector in Spain .

Government interests

The Spanish Government has also given incentives to entrepreneurs, such is the case of 4/2013 Law that establishes a discount between 20% and 50% in the full state fee. The Public Sector represented mainly by the Centre for Industrial Technological Development (CDTI) and the National Innovation Enterprise (ENISA) also invested 118 million € in 2015, hitting the record number for the Spanish startup market of 659 million € invested (233% more than in 2013).

How to improve further?

In order to continue the path of growth, in 2015 a group of Spanish startup and non-profit published the “Spanish Startup Manifesto” . It compiles the headlines of what Spain needs in order to be a country where startups can thrive. The points of needed improvements proposed by the manifesto are:

Talent: Need to stop the brain drain because it has a very negative impact on the economy.
Capital: Need of more access to capital, more reinvestment of profits, more foreign investments and increase access to crowdfunding.
Regulatory Environment: Need of a stable and effective legal framework to facilitate the creation, management and closing of companies.
Ecosystem: Need to overcome the difficulties that prevent the materialisation of the startup potential that exists in Spain. This potential has grown significantly in the last couple of years.
Education: It is fundamental to drive the entrepreneurial spirit in all stages of education.
Culture: Need to overcome the cultural barriers that damage entrepreneurial activity.

Need a quick set up? Look at : https://www.thesurfoffice.com/

Looking for an expert in Spain? Ask us directly!

Stéphane

Senior analyst and strategist at HTBIS

Check the full HTBIS team here

The post Why not starting up in a Spanish City? appeared first on How to buy in Spain.