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Investing in buy-to-let property in Malaga

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Investing in buy-to-let property in Malaga

At Andalusian Lawyers, we’ve recently had several clients looking at buy-to-let property in Malaga. High demand and lack of supply mean that rental returns from this type of property are among the highest in Spain and ahead of Madrid and Barcelona.

On the back of an ever-improving property market on the Costa del Sol in general, Malaga city too has become one of the favoured spots for investment. Property prices have risen in the capital as has new development.

Many foreigners have bought property with holiday lets in mind. Malaga’s buoyant tourism has opened up the demand for holiday rentals over the last year, an upward curve mirrored by the long-term rental market.

Buy-to-let property in Malaga has most ‘immediate rentals

According to a report published by Idealista, one of the largest online property portals in Spain, the long-term rental market in Malaga has soared over the last year. Latest statistics show that there is huge demand and very low supply.

Four out of every ten new rental properties in Malaga are let within a week of entering the market. What is more, 18 per cent of these are taken in less than 48 hours. This speed in which rental properties fly off the books has earned Malaga the top position in Spain for ‘immediate rentals’.

Strong demand driving buy-to-let market

Analysts point to two reasons behind this unprecedented demand for rental properties in Malaga. Firstly is the influx of new residents. According to the Spanish Statistical Institute (INE in Spanish), some 19,000 people moved to Malaga last year.

The rise of holiday lets in Malaga also effects the supply of long-term rentals in the city. Many property owners opt for holiday rentals rather than long-term lets, reducing the number of properties on the market.

Rental returns high on buy-to-let in Malaga

A report from another property portal, pisos.com, reveals that rental rates in Malaga went up by 16 per cent in the year to last December. According to Idealista, rates have risen by 4 per cent in the last three months.

This rise in rates has increased returns on rental property in Malaga to 6.3 per cent, up from 5.5 per cent a year ago. This places Malaga in fourth position in the national ranking for highest returns, ahead of both Madrid and Barcelona.

Returns on business premises rentals in Malaga are even higher. Idealista calculates that they average 11.1 per cent a year, the highest in Spain.

Advice on buy-to-let property in Malaga

Investing in a buy-to-let property in Malaga is straight-forward providing you take expert advice, both on the purchase and on the rental itself.

Spanish rental law is stringent and long-term rental contracts contain binding clauses for the property owner. To protect your interests, employ the services of a lawyer specialized in rental law to explain to you the implications of long-term rental contracts and to draw up the contract itself.

Andalusian Lawyers have been safeguarding the interests and investments of their clients for over 25 years. Contact us for advice and a no-obligation quote for our comprehensive conveyancing services.

Interested in buying a property in Malaga? Read our 4-part guide to the city:

Guide to property in Malaga

Guide to property in Malaga centre

Guide to property in Malaga east

Guide to property in Malaga west

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