In the blog ‘New regulations for tourist rentals in region Comunidad Valenciana’ we explained the changed regulations for tourist rentals in this region.
However, changes also create opportunities.
Therefore, in this blog we take you through the opportunities:
Why invest in real estate?
We believe that investing in general always involves adapting to the market, looking from there for opportunities that arise and being flexible.
With low savings account interest rates, inflation and capital gains taxes, your savings are becoming worth less and less.
That’s one of the reasons we invest in real estate.
Not only because it is historically fairly stable, but also because of the high probability of an increase in value and the possibility of generating additional income from renting.
Advantages of Spanish real estate:
- Long-term value increase, especially in A-locations
- Stable returns and additional rental income
- Security; tangible value and your wealth is safe in bricks
What makes an A-location special?
Our selected properties are in prime locations where building land is scarce.
These properties are close to the beach and commercial facilities.
Also, many residents live in these areas which means there is liveliness all year round.
This has a positive effect on the reviews of tenants and thus the findability on booking platforms.
This results in higher occupancy rates and prices per night.
Since the prices for newly developed projects inland are only increasing as is the demand for Spanish real estate, there is a good chance that the value of your property in an A-location will increase in value.
Our take on the new rules:
- VVE cooperation: In already completed projects, the VVE often consists of many investors.
This creates valuable collaborations and we expect there is little chance of the VVE voting against rentals.
Neighbors reinforce each other in terms of occupancy and often exchange tenants in case of overlap. - Renting through platforms: Most bookings last up to 11 days.
Once you have your license, you can list the property on platforms such as Booking and Airbnb and use channel management and dynamic pricing such as active pricing to get the highest returns.
Soon we will inform you about our additional service for guidance in channel management and active pricing. - Expedited license: We have a contact in the Comunidad Valenciana who will help you obtain the tourist rental license more quickly, depending on the type of property and the municipality.
- Rental from 11 days: Previously you could rent out your property without a license from 1 month, now it is from as little as 11 days.
This still allows you to achieve a higher occupancy rate without a license.
This is not covered by tourist rentals. - Combination rental: If it is possible to combine short-term rental (up to 10 days) with mid-term (from 11 days), this has a very positive effect on the highest ROI.
Whether and how this combination is possible has yet to be confirmed. - Long-term focus: The rental license is valid for 5 years.
By then we will advise on new opportunities and the most appropriate strategy based on your long-term goals, as the market can change significantly in 5 years anyway.
Flexibility, as always, is also important here.
Additional opportunities:
- Fewer licenses means less competition, which positively affects price per night and occupancy rates.
- Demand for rental housing continues to grow, in part because of the many emigrants who want to rent before they buy.
- Demand for homes for sale continues to grow which increases the likelihood of profit when selling.
- Good relationships with tenants and exceeding their expectations with the tips we provide ensure repeat visits, making you less dependent on platforms.
- There are more ways to get returns from real estate, apart from the Buy to Let strategy, that don’t require a rental license.
Spain is big and each region offers unique opportunities.
We constantly keep our clients informed of the latest developments and the opportunities that arise as a result.
Would you also like to know more?
Contact us today, and find out how you can benefit from this growing real estate market!
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