Why People are Buying Spanish Property Again

Well, Brits and foreigners from other parts of the world are once again buying Spanish property, and according to reports their activity is quite strong. The buyers are buying because the developers have discounted, and you can't blame them really:

Developers have come to know that they will struggle to get any sales without dropping their prices by 20% minimum, and there have even been reports of discounts of up to 40%. This is not counting the repossessed and distressed sales that are currently available in abundance.

So, if you have ever enjoyed a holiday in Spain, and/or wanted a holiday home there now would most definitely be the time to buy. The question as to whether the property will ever be worth the pre-discounted and pre-crunch price is a moot-question if the property is chosen carefully -- the answer being: of course it will.

A high quality property, in a good area that is not overdeveloped will obviously recoop its value. This will happen very quickly after the repossessed properties dry up, and the international recession becomes a distant memory.

In the meantime, if a property worth £200k would yield 5% based on 20 weeks rental at £500pw, then knock 20% off that property and it will yield 6.25%, and knock 40% off and it will yield 8.33%. That is just a ballpark figure on rental rate and the occupancy (made the math easier) but you can see why people are currently looking at buying Spanish property in a whole new light.

The other benefit Spain has is that it is an established market, which people are favouring right now. Sales are also set to increase now with the pound strengthening against the euro.

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