Spain continues to attract the French, as well as the rest of Europeans, who come here not just to spend their vacations. While Spain's real estate market went through a major crisis between 2008 and 2013, a real recovery has been underway for over two years now. Households and investors alike are once again flocking to the Costa Brava to buy apartments, houses, farmhouses and villas at very attractive prices. The property market is tending to stabilize.
Who buys in Spain?
Climate, setting and cost of living all contribute to making this Spanish region one of France's favorite destinations, attracting tourists and year-round residents alike. These include, but are not limited to, a large number of retirees who come to take advantage of a much lower cost of living than in France. Many investors are also taking advantage of the stabilization of the Spanish real estate market to make attractive rental investments.
A number of new developments have also sprung up in Spain in recent years, particularly on the Costa Brava. New homes and apartments attract buyers for all the advantages they offer, particularly in terms of comfort, energy efficiency and potential capital gains.
Rental investments on the Costa Brava
Although property prices are starting to rise in Spain, particularly on the Costa Brava, they remain far below those in France. Buying an apartment in Barcelona can cost up to 3 times less than in Paris.
Luxury real estate is also on the rise in Catalonia. Wealthy foreign investors are buying upmarket villas on the Costa Brava. When rented out, these villas offer excellent returns for their owners.
Real estate purchasing power in Spain
The revival of the Spanish property market has also been boosted by a reduction in the administrative formalities involved in buying a home. Real estate purchasing power has increased by 87% in Spain since 2008, compared with 29% in France, according to a study of real estate purchasing power in Europe by Crédit Foncier. As in most of Europe, mortgage rates fell sharply to less than 2% in 2016. Ten years ago, they were over 5%.
It's now possible to buy a house or spacious apartment on the Costa Brava for a price that seems derisory compared to the French market. Today, buyers can borrow 30% more than they could ten years ago. Property prices on the market, meanwhile, are tending to stabilize.
There has been a very slight increase, estimated at 1%, after a long slump which saw prices fall by 26%.
While investment in luxury real estate is helping to drive up prices, particularly in coastal towns, it is still very attractive tobuy a house or apartment on the Costa Brava, whether as a year-round residence, second home or rental investment.