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Spanish real estate is more profitable than it was a year ago

 

Business premises bring a minimum return of 7,6%, 5,5% for houses and 4.6% for parking spaces

Property investment in Spain is more profitable than it was a year ago, according to the report published by idealista corresponding to the second trimester. The real estate profitability doubles, or in the worst case scenario, those which the Government Bonds offers at 10 years (2%).

Real Estate Investment on residential properties for rent (Buy To Let) has increased during the last twelve months. At the end of the second trimester it offered a gross return of 5.5%, compared to the 4.9% from twelve months ago.

Madrid’s minimum profit in the residential market is of 5%, slightly superior to that of Barcelona (4.8%).

 

Business premises maintains its place as the best property investment. In fact, buying one in Spain in order to rent it out gives a 7.6% gross return, compared to the 6.2% it gave last year. The biggest return is in Cordoba (9.2%) and Granada (8.5%). Las Palmas de Gran Canaria (8.3%), Malaga (8.1%) and Zaragoza (8%) are next. Madrid has 7.6%, and Barcelona 7.5%. Business premises in Castellon give less to investors (only a 4.6% profit), followed by Salamanca (5.3%) and Cadiz (5.6%).

 

On the other hand, the real estate product which gives the least profit are parking spaces; which finished the second trimester with a 4.6% from June’s 3.6% 2014 profitability. Even so, it is still more interesting than what registered the 10 year bonds. The best profit is found in Toledo (5.6%), followed by Las Palmas de Gran Canaria (5.3%), Santa Cruz de Tenerife (5.3%) and Pamplona (5.1%). The municipalities with the least profitable garages are A Coruña, with 1.6% profit, Barcelona, with 2.3%, and Salamanca (2.6%). The return in Madrid is of 3.3%.

 

Investment on housing for rent has increased during the last twelve months. At the end of the second trimester it offered a gross return of 5.5%, compared to the 4.9% from twelve months ago. Concerning the Spanish regional capitals, Lleida is the most profitable one, with a 7,8% profit. Followed by Las Palmas de Gran Canaria (6.2%), Palma de Mallorca (5.8%), Huesca (5.7%) and Huelva (5.7%). Madrid’s minimum profit is of 5%, slightly superior to that of Barcelona (4.8%). However, the lowest profit in Spain are those that landlords in Ourense (3.3%), A Coruña (3,6%) and San Sebastian (3.8%) receive. Next comes Lugo (4%).

 

Offices register a minimum profit of 6.3%. The highest profit is found in Vitoria, with a gross return of 7,5%. Next come Sevilla (6.6%), Santa Cruz de Tenerife (6.5%), Zaragoza (6.3%) and Las Palmas de Gran Canaria (6.1%). In Barcelona profitability rises to 5,8%, while in Madrid it lowers to 5.6%. On the other hand, we find the profit of Valencia (4.8%), A Coruña (4.9%) and Alicante (4.9%). The office market isn’t as uniform as other products are, which makes it impossible to obtain statistical data for more than half of the Spanish regional capitals.

 

In order to elaborate this report, idealista divided the sales price offered by the rental’s price that landlords asked in the different markets that refer to the trimester rates of housings, garages and  business premises corresponding to the second trimester of 2015. The result obtained is the gross percentage of profit a landlord receives for renting a property.

 

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