# Is it possible to earn an income from renting in Spain?



## Matt Flynn (May 10, 2015)

Dear Expats,

Firstly thank you for such a great site and bless all you very helpful people! Hopefully I will be in the position to offer advice some day!
I'll get to it...... We just got back from a property show in Olympia London and got mixed reports about earning a 5% return from renting properties in the costa del sol/ blanc a area coastline?
Does anyone know if this a feasible idea as property seems to be such great value at the moment, many thank in advance, matthew


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## jojo (Sep 20, 2007)

Matt Flynn said:


> Dear Expats,
> 
> Firstly thank you for such a great site and bless all you very helpful people! Hopefully I will be in the position to offer advice some day!
> I'll get to it...... We just got back from a property show in Olympia London and got mixed reports about earning a 5% return from renting properties in the costa del sol/ blanc a area coastline?
> Does anyone know if this a feasible idea as property seems to be such great value at the moment, many thank in advance, matthew


I guess it depends on your overheads (mortgage, insurance, taxes....) You then have to factor in that there are simply loads of properties up for rent, so you may not have tenants all the time....

Personally, I wouldnt think its a good investment, unless you are looking for something for yourselves in years to come and would take advantage of it as your holiday home.

It sounds to me like a sales pitch, that may be ok, but needs alot of investigation. You've come to the right place lol - I'm no expert, but there are folk on here who will know more



Jo xxx


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## mrypg9 (Apr 26, 2008)

I was a landlord in the UK and Canada. I would never be a landlord in Spain.
It's too difficult to get rid of troublesome tenants and although there are bad landlords I've heard many many more stories about bad tenants. People move about a lot here and are often hard to trace.
And as Jo says there are so many properties for rent, especially two or three bed apartments on urbs.


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## snikpoh (Nov 19, 2007)

Matt Flynn said:


> Dear Expats,
> 
> Firstly thank you for such a great site and bless all you very helpful people! Hopefully I will be in the position to offer advice some day!
> I'll get to it...... We just got back from a property show in Olympia London and got mixed reports about earning a 5% return from renting properties in the costa del sol/ blanc a area coastline?
> Does anyone know if this a feasible idea as property seems to be such great value at the moment, many thank in advance, matthew


IMHO - NO!

Do they say if that predicted 5% is gross or nett?

Personally, I can't see it happening. 

Who would manage your holiday lets? At what cost?

If you're looking at long-term lets, what are your plans for when a tenant goes bad? Who will be there to file the notices with the judge, police etc. What will you do for the years that it could take to get them out?

... don't do it unless you have a very good (Spanish speaking) infrastructure in place.


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## larryzx (Jul 2, 2014)

snikpoh said:


> Who would manage your holiday lets? At what cost?
> .


Apart from the various, many obscure, rules that one must comply with (varying I believe from Region to Region) I understand that if one employs an agent/person to manage lets then the lets are subject to IVA. I am not sure of the rate but maybe from 10% to 21% depending on who gives the advice ! I also believe that as an unregistered person for IVA, you must make the returns every time you recieve a payment, so maybe 12 or more times a year. For that you would probably need a gestor/accountant, and thus more cost. From what I know, and understand, most private lets are not 100% legal, albeit that many owners do not know that, and so probably make some income.

If you declare as legally required, and comply with all the rules (assuming you can discover what they are *) it is probably not a good business prospect to let, unless maybe it is on a ‘business scale’ i.e. not just one or two properties.


* Asking legal professionals will result in various answers, many, maybe all, of which are not 100% correct. "Ask 6 lawyers, get 7 different answers, all of which are wrong."


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## snikpoh (Nov 19, 2007)

larryzx said:


> I understand that if one employs an agent/person to manage lets then the lets are subject to IVA.


Please stop me when I go wrong;

Using an agent requires one to pay IVA
To pay IVA one must be either a registered business or autonomo
To be autonomo one must have a business or trade
To have a trade it must be on the approved 'list' from hacienda


My point to all this - I tried to declare myself autonomo based on the fact that I have holiday lets and long-term lets, and this was my income. Hacienda refused on the basis that this was not a 'trade' or a 'business'.

I now have to manage these lets without being autonomo - I declare all income to hacienda but don't pay IVA or SS.


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## larryzx (Jul 2, 2014)

snikpoh said:


> Please stop me when I go wrong;.


Hi, well as I said,_ Asking legal professionals will result in various answers, many, maybe all, of which are not 100% correct. "Ask 6 lawyers, get 7 different answers, all of which are wrong."_

And if you cannot work it out Snikpoh, with your wide knowledge and experience, then who will be able to ?

God Bless 'our' Spain !


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## skip o (Aug 1, 2011)

I don't see the appeal of being a landlord in Spain unless the landlord lives very close to his/her properties, or really really trusts his/her property manager. There are plenty of places in the US where you can get 10% net. And problem tenants are a lot easier to remove there. I net 15%-18% on my US rentals.


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## mrypg9 (Apr 26, 2008)

What you will 'net' from property rentals depends on so many variables.
Interest rates on other assets which may vary according to value and asset class, current state of the rental market, property values generally, operational costs including losses and damage caused by 'bad' tenants, of whom it seems there are many in Spain, maintenance costs, interest repaid on initial property purchase cost..

I came to the conclusion that 'real' money could be made only if you had a large portfolio of 'desirable' properties and could afford professional management fees.
So we sold.


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## Matt Flynn (May 10, 2015)

Wow thanks for all that information it's a lot to take in and now maybe it doesn't seem like a good idea, well do a little more research though.
To answer some of the questions firstly the 5% would ideally be net as we are buying the places outright, no mortgage. I would be managing them or very close by, and there would be three to four properties in the Costa del sol area and renting to holiday makers only hopefully who would pay up front.
Very interesting what you say about the hacienda, seems like they are trying to protect the Spanish businesses as much as possible.
Really greatful for all these answers thank you all loads :smile:


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## mrypg9 (Apr 26, 2008)

You'd get a better return from wisely investing sums over 500k euros and with no hassle. Your 5% is very unlikely to be net after you've factored in taxes, management fees, repairs and maintenance and times when you have no occupants which could be for most of the year.
Holiday lets are two a penny on the CdS.


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## Matt Flynn (May 10, 2015)

Hmm I see, ok thanks, I don't suppose if anyone knows if there is a better place on the coast to let?


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## jojo (Sep 20, 2007)

Just for info, we're looking at renting for a holiday this summer - June/July ish in and around Nerja (just east of Malaga) and the choice is phenominal - it does seem to be as mrypg9 says "holiday lets are two a penny" 

Jo xxx


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## Matt Flynn (May 10, 2015)

Well I'll take the positive out of it Jojo! Thanks again for your help and advice, hope you have a really great holiday and thanks for letting me know about that availability :smile:


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## Horlics (Sep 27, 2011)

Matt,

I have a apartment in the UK which I rent out. It makes 6% net.

I have an apartment in Spain which I don't rent out, but my neighbour's place, which is exactly the same, rents very well at a good rate. I have no doubt at all that I could make 6% on my place if I wanted to rent it out.

I have a friend who has a place in the same town which she rents for between 30 and 35 weeks of the year. She makes a lot more than 6%.

If you buy the right property in the right place, it is possible to make a better return renting out a holiday home in Spain for a few months than you will for an all year rental in the UK. That is the case with my places.


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## Leper (May 12, 2010)

Hello Matt, Keep your money in your pocket. Don't even think of purchasing property in Spain as an investment. Your investment will fail.

Let's say you buy property on a good resort anywhere in southern Spain.I would guess you would have no difficulty in renting your property from mid June to mid August. You would pick up some rentals during May to mid June also along with some in September. But, it is the months October to April (7 months) you will encounter difficulty in even acquiring rentals @ €550.00 per month. 

There are many costs that will drain any profit you hope to make. For a start there is the wear and tear of the accommodation. Things break down. Broken utility items must be replaced. The accommodation must be cleaned. You probably will have to pay for advertising. Add in refuse collection, local taxes, Spanish taxes, Community Fees, Public Lighting, etc. We haven't even scraped the surface of real estate agents fees yet.

Matt, you will probably encounter so much competition from others in the rental market that all you will increase is your stress levels.

If you want to dabble in the property market buy a place in Ireland as near to Dublin as you can. Rental prices are increasing @ 15% per annum. It is very difficult for the Irish to get mortgages after our banks broke the country up to eight years ago and the rental market is buoyant as a result. 

Wait for the sun merchants to disagree with me. If you want a good return from your investment, buy in Ireland but don't come looking for sun.


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## Isobella (Oct 16, 2014)

Many apartments were empty on the CDS even in August last year. There is so much over supply.


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## Leper (May 12, 2010)

Isobella said:


> Many apartments were empty on the CDS even in August last year. There is so much over supply.


Good on Ya Isobella, Finally, some truthful truth.


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## Horlics (Sep 27, 2011)

Isobella said:


> Many apartments were empty on the CDS even in August last year. There is so much over supply.


Apart from the in-demand places, where there is under supply. I would guess.

I have to guess because I don't know the CDS. 

I do know Javea. I was asked last week by a friend whose apartment is fully booked through to the end of September if I was interested in taking a booking. The people booking can't find anything for their dates, there's under-supply.

They're ready to pay 1200 Euros a week for 2 weeks.

That said Op, I am not recommending Spain over anywhere else. I happen to agree with Leper that a purchase near Dublin right now would be a good bet, and I do think it would be a better long term bet than Spain in terms of total returns.

But the question was, could you make 5 ish % yield in Spain. And the answer is, YES, you can.


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## mrypg9 (Apr 26, 2008)

No, Horlics, not 'yes YOU can'
Should read 'yes a lucky few can'.
Same with finding work. Some, a few, do. Most don't.


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## Horlics (Sep 27, 2011)

No mrypg9,

A person able to identify the right property in the UK for a 6% return should be able to do research and do the same in Spain.

There's a property for sale near where I live. It WILL make 6%. There are about 6 properties on the same little complex that are making that year in, year out. The owners all pass on bookings and every year they turn people away during peak times. And they are very successful out of season too.

But these are a 60 second walk from the beach. I have no doubt some clots will walk into a show in the UK and buy places where there is massive oversupply, building sites nearby, and no amenities. Those people won't make 6%. Presumably these are the people you don't label as the lucky few. I grant you, they do exist.

This is an entirely different subject than work, so let's not confuse the two, eh.


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## jojo (Sep 20, 2007)

Horlics said:


> No mrypg9,
> 
> A person able to identify the right property in the UK for a 6% return should be able to do research and do the same in Spain.
> 
> ...



Its a high risk gamble - whether the right property or not, lets face it, who's "right" property, what about overheads, crises, cost of unexpected incidentals........ mrypg9 pointed out, its possible, but too many if, buts and maybes involved to catagorically say YES!!!


You also have to remember than if something *IS* the *RIGHT* property, it'll cost a lot more............ or is the vendor simply pushing their luck????
Jo xxx


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## Horlics (Sep 27, 2011)

Jojo,

The price paid and the letting rates will determine the yield, as they do in the UK. The right property will be more pricey than the wrong one, but it will be the one which delivers the target yield. I don't know what you mean about vendor pushing their luck. It's up to the purchaser to secure a property at a fair market price, and that price must not be so expensive that the required yield cannot be achieved.

As for overheads and the rest, those are things that occur everywhere, it's just another factor to allow for when working out the financials. My tenant had to call a plumber last week, cost to me 125 quid. I'll still make 6% this year.


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## jojo (Sep 20, 2007)

Horlics said:


> Jojo,
> 
> The price paid and the letting rates will determine the yield, as they do in the UK. The right property will be more pricey than the wrong one, but it will be the one which delivers the target yield. I don't know what you mean about vendor pushing their luck. It's up to the purchaser to secure a property at a fair market price, and that price must not be so expensive that the required yield cannot be achieved.
> 
> As for overheads and the rest, those are things that occur everywhere, it's just another factor to allow for when working out the financials. My tenant had to call a plumber last week, cost to me 125 quid. I'll still make 6% this year.



You seem to be missing the point, it may work for some, those LUCKY enough to choose the right house, the right situation, the right circumstances and the right tenants. But the key word is LUCK and luck isnt something to guide you into making a good investment. Buying in Spain is risky and needs luck more than anything else

Jo xxx


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## Horlics (Sep 27, 2011)

Jojo,

Please don't assume I am missing the point just because I don't agree with your assertions or adopt your point of view. It's better that you assume I have the intelligence to understand your point, because I can assure you I do.

To be clear, my disagreement began when you said "it's a high risk gamble". It's not, in my view. And luck has very little to do with it.


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## snikpoh (Nov 19, 2007)

Surely one of the risks is the tenant? What if they wreck the place, stay but don't pay etc. etc. These issues are harder to solve in Spain.

Also, for me, the bigger issue is that there is a resale opportunity in UK and the hope that prices will have increased enormously so there's an exit strategy. There is no such guarantee in Spain - so what's the exit strategy here?


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## Horlics (Sep 27, 2011)

snikpoh said:


> and the hope that prices will have increased enormously so there's an exit strategy. There is no such guarantee in Spain - so what's the exit strategy here?


Come to Birmingham, I can show you hundreds of apartments that you can buy today for what they were selling at 10 years ago. Anybody hoping for an enormous increase will have been disappointed.

So again, we see that Spain is not unique.


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## Isobella (Oct 16, 2014)

How could anyone have made anywhere close to 6% with Spanish property having dropped so much. rents have dropped too. I know a rental agent and she reckons on short term renting owners are fortunate to get 3 months per year. Again I am referring to the CDS but I wouldn't think any of the other coasts will be different.

Breakages are high and other damage. We used to rent ours and damage included a curtain pole down and frequently having to get out a TV tech to retune the TV. Lots of missing towels. People on holiday don't care, they sit on sofas covered in sun tan oil. Then there is normal wear and tear to cost. 

As things are now it would be better to keep your money in the bank at a measly 2%


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## Horlics (Sep 27, 2011)

Isobella said:


> How could anyone have made anywhere close to 6% with Spanish property having dropped so much.


The friend I am talking about bought in 2003. What subsequently happened to prices had no bearing at all on her yield. What happened to letting rates over the years obviously did, but they've been very good.


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## Isobella (Oct 16, 2014)

Horlics said:


> Come to Birmingham, I can show you hundreds of apartments that you can buy today for what they were selling at 10 years ago. Anybody hoping for an enormous increase will have been disappointed.
> 
> So again, we see that Spain is not unique.


Are you sure? Not according to the media. The BBC also did a feature on the property market there attracting overseas investors just a few weeks ago.


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## Horlics (Sep 27, 2011)

Isobella said:


> Are you sure? Not according to the media. The BBC also did a feature on the property market there attracting overseas investors just a few weeks ago.


Yes I am sure, I did several viewings of properties there about 3 months ago and it's easy to find out the last sale price, which was part of the research I did. I have an apartment there, I bought it for 1,000 less than the seller bought it for, although it had been worth 12% more between her buying it and selling it to me.

I could give you zoopla links, but I can't be bothered. Believe or dismiss, it's up to you.


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## jojo (Sep 20, 2007)

Horlics said:


> Yes I am sure, I did several viewings of properties there about 3 months ago and it's easy to find out the last sale price, which was part of the research I did. I have an apartment there, I bought it for 1,000 less than the seller bought it for, although it had been worth 12% more between her buying it and selling it to me.
> 
> I could give you zoopla links, but I can't be bothered. Believe or dismiss, it's up to you.



I believe that you've been lucky so far.

But to recommend someone, who doesnt live in Spain and is only asking due to a meeting with a sales rep at a property show in the UK, take the route you have, or to imply its a money spinner is irresponsible in my opinion

Jo xx


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## Isobella (Oct 16, 2014)

Horlics said:


> Yes I am sure, I did several viewings of properties there about 3 months ago and it's easy to find out the last sale price, which was part of the research I did. I have an apartment there, I bought it for 1,000 less than the seller bought it for, although it had been worth 12% more between her buying it and selling it to me.
> 
> I could give you zoopla links, but I can't be bothered. Believe or dismiss, it's up to you.


I bothered to find a link

House prices in Birmingham rise 10pc in one year - Birmingham Post


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## Horlics (Sep 27, 2011)

Jojo,

I was giving balance. Some people dismissed it but based on my experience I believe the yield quoted is possible. Adding terms like "money spinner" really isn't necessary.

What, exactly, do you think I have been lucky with?


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## Horlics (Sep 27, 2011)

Isobella said:


> I bothered to find a link
> 
> House prices in Birmingham rise 10pc in one year - Birmingham Post


House prices can rise 10% in a year and yet it can still be possible to buy a place for about the same as it was 10 years ago.

Obviously!


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## Horlics (Sep 27, 2011)

OK,

Two examples, there are hundreds more.

Here's one for sale at lower than its last sale price:

2 bed flat for sale in 128 Alcester Road South, Kings Heath B14 - 36169390 - Zoopla

Here's one in answer to the 10% increase point. This one has been on sale since last November and the price has been reduced twice:

2 bed flat for sale in Alcester Road South, Birmingham, West Midlands B14 - 35251615 - Zoopla

If you want to believe headline numbers rather than detailed research and local knowledge ("luck" in Jojo's language) then go ahead.

The idea that the UK is a sure bet whilst Spain is not is wrong. And I am not being gung-ho, maximum caution is required wherever this game is played. All I am saying is, it is possible to get 6% in the UK, I do. And it is possible in Spain, a friend does.


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## jojo (Sep 20, 2007)

Horlics said:


> What, exactly, do you think I have been lucky with?


 Finding tenants at all, tenants who pay, tenants who havent caused damage, not having to resort to courts to evict tenants, your maintenance costs, your choice (at this time) of what you think is the "right" property......

Playing devils advocate is fine, but remember that its not good to encourage folk when we all know that buying to rent as things are at the moment isnt a done deal - its fraught with problems, crises and huge potential losses.

From what you have said, it seems that you are the more the exception rather than the rule. Yes, money can be made, but it isnt a given and it is a huge risk. 

Jo xxx


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## Horlics (Sep 27, 2011)

jojo said:


> Finding tenants at all, tenants who pay, tenants who havent caused damage, not having to resort to courts to evict tenants, your maintenance costs, your choice (at this time) of what you think is the "right" property......
> 
> Playing devils advocate is fine, but remember that its not good to encourage folk when we all know that buying to rent as things are at the moment isnt a done deal - its fraught with problems, crises and huge potential losses.
> 
> ...


I'll tell that to my mate in the UK who has 15 ish properties. I'll have to wait until he gets back from his 5th holiday this year though. I think he's in the Caribbean at the mo.

And he has to deal with all those things you mention, but it's all part of the game, the profitable game.

Oh, i'll warn my other mate with his 4 student let houses in Birmingham too. He might decide to forgo the 50k a year he makes because it's a dangerous game and all down to luck.


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## jojo (Sep 20, 2007)

Horlics said:


> I'll tell that to my mate in the UK who has 15 ish properties. I'll have to wait until he gets back from his 5th holiday this year though. I think he's in the Caribbean at the mo.
> 
> And he has to deal with all those things you mention, but it's all part of the game, the profitable game.
> 
> Oh, i'll warn my other mate with his 4 student let houses in Birmingham too. He might decide to forgo the 50k a year he makes because it's a dangerous game and all down to luck.


Good idea. Let them know how lucky they are

Jo x


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## Isobella (Oct 16, 2014)

Birmingham doesn't seem to have done bad long term if you aren't cherry picking but I think we should get back on topic after this.

Home.co.uk: House Prices Report for Birmingham - January 1995 to February 2015


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## mrypg9 (Apr 26, 2008)

Horlics said:


> No mrypg9,
> 
> A person able to identify the right property in the UK for a 6% return should be able to do research and do the same in Spain.
> 
> ...




No. They are two entirely different markets, operating with different clienteles under different laws.

You generalise from a limited experience. So this little development of six properties makes money...there are literally tens of thousands of similar properties all along the costas which stay empty, some all the year round.

You have to factor in so many variables...the current trend for 'all in' holidays, the uncertain future for the £ sterling, a downturn in the European economy...holidaymakers are fickle and often on a limited budget. Unless you live near your investment you have little control over what happens on the ground.

I was a UK landlord and I can only say that no way would I rent out property here. I know people who own rental agencies and people who rent their properties privately and no-one is making a killing, believe me.


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## Horlics (Sep 27, 2011)

Isobella said:


> Birmingham doesn't seem to have done bad long term if you aren't cherry picking but I think we should get back on topic after this.
> 
> Home.co.uk: House Prices Report for Birmingham - January 1995 to February 2015


We better had, because that report settles it. Not much money made since 2006. They like to include the years before then because that's when the big gains were made, but we're in a different world now.

And I wasn't cherry picking. There are hundreds, probably thousands of 2 bedroom apartments that haven't made money.


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## mrypg9 (Apr 26, 2008)

Horlics said:


> I'll tell that to my mate in the UK who has 15 ish properties. I'll have to wait until he gets back from his 5th holiday this year though. I think he's in the Caribbean at the mo.
> 
> And he has to deal with all those things you mention, but it's all part of the game, the profitable game.
> 
> Oh, i'll warn my other mate with his 4 student let houses in Birmingham too. He might decide to forgo the 50k a year he makes because it's a dangerous game and all down to luck.



You don't have to be a landlord to be able to afford 'five holidays' , you know. I had more than that when I was a Head Teacher and my salary got paid for me, no need for any go-betweens such as property managers, accountants, cleaners, lawyers...
I know people who have many more holidays than I did, better ones too, Caribbean holidays are nothing exceptional these days.
So that proves nothing, just that there are people who can afford more than two weeks in Scarborough every year and who don't 'go through the hassle of owning and maintaining property and dealing with troublesome tenants.
As for making £50 k out of four houses...£12500 per house. .....and with students...Not exactly megabucks.

The best way to earn a good income is to have a 'nice' job that you enjoy with a good professional salary . After that, the best way is to stick your money in a nice investment account where the only work you have to do is to lift a phone to contact your Fund Manager now and then. 

Can I ask...what are your experiences of being a landlord in Spain and /or the UK?


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## mrypg9 (Apr 26, 2008)

Horlics said:


> .
> 
> And I wasn't cherry picking. There are hundreds, probably thousands of 2 bedroom apartments that haven't made money.


Very true. And three bed apartments. And villas.

That's the point we're trying to make.


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## baldilocks (Mar 7, 2010)

If you are in a suitable location, then holiday lets are a possibility. We and a great number of Spaniards rent somewhere when we go on holiday. We go for apartments/chalets/cottages/ (2/3 BR) etc. that will accept well trained dogs and have facilities for self-catering (stove top, microwave, toaster, maybe an oven). We usually take one or two holidays a year (September and over Christmas/New Year) and since we don't have central heating at home, we rent somewhere that has, for our winter break. We tend to go somewhere that is in one of the Natural Parks so that there is usually plenty to see and do (we are not beach people!)


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## CapitalK (May 15, 2015)

Hi All,
I have just joined the forum (first post).
We are thinking strongly about moving from london to somewhere between Marbella and San pedro area where I will manage some holiday lets I intend on buying.
I have BTL's in london and Ireland and am going to purchase in costa del sol we are going there next on 10th June to do more research and have meetings lined up with some agents.
As with anything ( in this case property) I firmly believe you will succeed if you research well (buy in right location), buy at the right price (prices have bottomed out), have the best (par with the best) product (refurb and furnish to a high spec) and work hard (market well).

Does anyone actually own property in these locations or know anyone that would like to meet us when we come next month.
Many thanks
K


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## mrypg9 (Apr 26, 2008)

We have family property to the west of San Pedro. I know a few people who rent their houses round here in July and August, they rent to wealthy Russians and charge around £3000 per week for smart front line beach villas , four or five bedrooms, or properties in the campo with a lot of land. 
They either go back to the UK or move into pisos they own during that time. 
Other people I know rent long term as there seems little steady demand for year round occupancy with holiday lets. Agents may well tell you otherwise so best to ask around. 
Renting long term has its advantages but also its perils.


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## CapitalK (May 15, 2015)

Hi
Thanks Mrypg9,
What kind of dog have you got?? Big looking ! We have 2 golden doodles.

I should imagine year round demand isnt great for everyone but you must know some people who do it successfully??

My properties in uk/ireland are always refurbished and furnished very nicely and priced competitively and are always full.

Just from looking on owners direct and holiday lettings there seems to be many many empty even in july and august yet the price stays high. 
Also many just arent up to scratch on the interiors front old kitchens/bathrooms and tatty furniture and interiors.
Little touches like coffee machines , welcome packs etc go a long way too.
My motto has always been keep dropping the price till someone bites do you think this would work on holiday lets??

That is one type of rental ive yet to do but have done lots of room and property lets.

Thanks

Keith


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## mrypg9 (Apr 26, 2008)

CapitalK said:


> Hi
> Thanks Mrypg9,
> What kind of dog have you got?? Big looking ! We have 2 golden doodles.
> 
> ...


Hi Keith, 

Dog in photo is a Cane Corso, she's a rescue dog. If you look at the photos in my album you'll see my other dog, a Rhodesian Ridgeback, a gentle giant.

I honestly don't know anyone who rents all year round with a succession of short term lets, my friends who rent out property have long term tenants, apart from the ones who have big houses they move out of in the summer.. It's very hard to get rid of troublesome tenants here and some have had horrendous experiences.

Of course there are people who do well out of holiday lets but I think the market is fairly saturated round here.

I could introduce you to a couple of rental agents, good friends. But I wouldn't trust even my friends to give an accurate picture of the market if they were trying to sell to you!
Write a few more posts then you can pm me,

Mary


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## Matt Flynn (May 10, 2015)

Ok I'm sorry if I've started an arguement on here!!!
Thank you Horlicks for some positive feedback at last! And interesting advice about Ireland, shame there isnt the climate there.
I think that's goog advice about all the costs though :smile:


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## jojo (Sep 20, 2007)

Matt Flynn said:


> Ok I'm sorry if I've started an arguement on here!!!
> Thank you Horlicks for some positive feedback at last! And interesting advice about Ireland, shame there isnt the climate there.
> I think that's goog advice about all the costs though :smile:


Dont worry about us, we love a good discussion, thats what makes the forum work ultimately. You get losts of views and points. You can make your own mind up as to the pros and cons lol

Jo xxx


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## Matt Flynn (May 10, 2015)

Yes I agree Horlics, you must be careful about what to buy, we were pushed into buying properties on CDs but were 2 mins drive from a beach! No way!!!!!
And as to things getting broken and ruined,we'll surely if they have paid up front and paid a deposit they lose it? Like you say it's the same in the UK or rest of the world?


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## Matt Flynn (May 10, 2015)

Well Mr capitalk I will look at your story with interest as we are sharing the same "ideal", good luck! Sorry can't help you out at the moment but hopefully in the future!


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## Matt Flynn (May 10, 2015)

You have been Very helpful Jo thanks, God bless you all and let's stick together!!!!
Can't help thinking though that you want to rent down there so there is light at the end of the tunnel:smile:


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## jojo (Sep 20, 2007)

Matt Flynn said:


> You have been Very helpful Jo thanks, God bless you all and let's stick together!!!!
> Can't help thinking though that you want to rent down there so there is light at the end of the tunnel:smile:



Indeed................ the next installment is some friends of ours who have a two bedroom apartment that they let out have told us we can have it for just the cost of the electricity/water for a week, cos they've found bookings are down this year lol. That said, its not something that they need to survive or advertise very much.

Something else you need to think about is the overall property prices, which may still be falling??? I'm not sure. I doubt they're rising, if only because there are still so many half built, new builds, empty repossessions to be gotten rid of.

Now its up to you to decide - pros and cons all laid out infront of you 

Jo xxx


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## mrypg9 (Apr 26, 2008)

Matt Flynn said:


> Yes I agree Horlics, you must be careful about what to buy, we were pushed into buying properties on CDs but were 2 mins drive from a beach! No way!!!!!
> And as to things getting broken and ruined,we'll surely if they have paid up front and paid a deposit they lose it? Like you say it's the same in the UK or rest of the world?


But it isn't like the UK or the rest of the world....

The renting market in Spain is very different. For one thing, there is a lot of movement of people here. It's a very transient society in some areas especially. Hard to track down moonlight flitters. Secondly, although there are laws protecting landlord and tenant in practice the odds are stacked against the landlord. 
If a tenant doesn't pay the rent it could be months before a court orders an eviction and the probability of you getting your money back is almost nil. Most tenants who have paid a deposit use it as the last month's or two month's rent. So any chance of getting compensation for damages is low.
We were landlords in the UK but on leaving ten years ago sold all our properties, commercial and residential. Since then we have rented, first in Prague where we spent three years, afterwards in Spain. We have been told we are the 'dream' tenants. We are a 'mature' female couple, two big but well-behaved dogs, pay the rent a year in advance and look after the property. We now live on the edge of a quiet seaside village but have already been offered a house in town when we intend to move in a couple of years.
But.....we are the first tenants our current landlord has had who have paid the rent! Twice he has taken tenants to court ....and lost over 10000 euros from just two of the worst offenders. We know of other landlords who have had similar experiences, even worse ones. There have been horror stories on this Forum.
Now I'm not saying that all renters are tenants from hell. There are dreadful landlords too. I have friends who rent out the houses they live in for the summer months and others with steady, 'respectable' long term tenants. I have a friend who has a business dealing in holiday lets and most are unoccupied for seven months or more out of twelve.
My point is merely to say that it's misleading to give the impression that all you need to do is to buy your properties, kit them out and wait for the money to come rolling in. It may be that way for a lucky few but it isn't like that in most cases. It's easier if you live here and can manage things yourself, of course.

Someone who lived near us had a tenant from hell who paid a month's rent and no water or electricity bills. After a few months he became exasperated and cut off the water and electricity. This is illegal in Spain and the tenant called the police. He was charged and given a date for a court appearance. He went back to the UK before that date and the three properties he rented out now stand empty. I'm only surprised that they haven't been squatted as is more often than not the case with empty properties.


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## Isobella (Oct 16, 2014)

Unfortunately most only want the good news I had forgotten about advertising costs too.


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## Horlics (Sep 27, 2011)

Matt Flynn said:


> Yes I agree Horlics, you must be careful about what to buy, we were pushed into buying properties on CDs but were 2 mins drive from a beach! No way!!!!!
> And as to things getting broken and ruined,we'll surely if they have paid up front and paid a deposit they lose it? Like you say it's the same in the UK or rest of the world?


The trouble is, being careful about what you buy is very difficult if you don't know an area well. As mentioned earlier, I knew that many properties in Birmingham are not following the headlines (which say up 10%) because I have been looking to buy another and have been viewing and done a lot of checking up on current and previous prices, and I know the area well. But for me, growth of the value of the property is an extra benefit after the primary consideration, which is an income at a target % of the overall investment. The point is though, you will want to be as sure as you can that you won't lose a significant (to you) amount of value and that you will be able to rent them out. You're going to have to do a lot of research to get comfortable with that, I think.

Then, after having taken the leap, you're into ongoing management of lets. That means putting together estimates of the income and expenses, and yes, there will be occasional breakages and other hassles, but plenty of people make money overall whilst having to deal with such eventualities. 

I should say, because the discussion has been across both long term and holiday letting, I am talking about the latter. I would not bother with long term letting because I don't think the returns are there, but holiday letting is different. As you say, with holiday lets you get a deposit. Also, some of the letting sites now include insurance in their fees. Airbnb, for example, provides some cover for the owners of properties. (And advertising on the rental sites is another expense for your spreadsheet!).

There's a good site with a discussion by people who run B&Bs, holiday lets, etc. It's Lay My Hat - advice for rental owners, from rental owners


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## Isobella (Oct 16, 2014)

When doing costings don't forget to account for voids, which are many on the Costas. Has anyone posted on here who actually owns a property(s) for rental with optimistic figures?


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## Leper (May 12, 2010)

Just to add an additional tuppenceworth from a cold and wet island regarding privately renting out accommodation in Spain.

The Travel Industry in Ireland has taken quite a hit. They screwed the Irish public for years and thought they would never see a poor day. Paddy copped on somewhat and stayed at home. The recession came and Paddy copped on more i.e. rented privately and saved a fortune.

The Travel Industry was never going to lie down and regrouped. They closed many Travel Agency outlets and concentrated on Call Centres Sales. The Call Centres and Online bookings worked for a time but what was being sold as an Irish Product (I know, holidays in Spain, an Irish Product!) turned out largely to be a UK Product [Remember, there is recession in ROI and Buy Irish is a catchphrase].

This year though, the Travel Industry has offered cheaper holidays (something they should have been doing for years but continued to screw the Irish). The canny Paddy has stayed with the private option while others returned to Travel Agencies (Online + Call Centres).

Some people here pointed out that private bookings were lower in 2015. Some of the private owners have not recognised the extent recessionary times in English speaking Europe yet. But, some rental is better than none. Competition from the likes of Turkey, Greece, Italy, France, Malta, Cyprus has increased.

What is 5% gain on investment this year could be lower in twelve months time. Let's look at why we all bought in Spain (a) Investment (b) Better quality of Life (c) Family (d) Retirement.

Most of these went out the window in the ongoing recession. We are trying to rent out our places for more and more weeks every year. The value of our investment has reduced. The extent of our stays has reduced. Our costs have increased. Because of this our families have to spend less time in Spain. And the Spanish taxman has increased activity also [shivers].

Forget about investing in Spanish property, unless you can bear the hit. If you want a return on your investment think Ireland and as near as possible to Dublin. Rain with profit beats sun with headaches any day and you won't get skin cancer.


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## Tammydog (Mar 7, 2015)

Where's all these properties to rent. We have just contacted several agents for a 3 month and maybe 6 months rental from beg July this year along Costa Blanca South. And they have nothing available as all their properties are rented out for the season?
Or are they just saving them for the higher holiday rental prices? We only want to around 600 euros per month at the most?


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## baldilocks (Mar 7, 2010)

Tammydog said:


> Where's all these properties to rent. We have just contacted several agents for a 3 month and maybe 6 months rental from beg July this year along Costa Blanca South. And they have nothing available as all their properties are rented out for the season?
> Or are they just saving them for the higher holiday rental prices? We only want to around 600 euros per month at the most?


Because you are looking at the holiday season. They aren't going to rent to you for 600 per month when they can get that per week!


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## Tammydog (Mar 7, 2015)

That's what we are aware of but if they get rental for long term it is normally cheaper. We only need a little place for 2 nothing fancy. But guess there seems to be a bit of boom this year from what the agents a telling us. So may pay us to stay at our sons for summer and come over in the Autumn. But really want to buy to live and need to get timing right. One agent we have dealt with reckons he sold 59 properties last month. And judging the people viewing when we were there. I not sure but I don't think I disbelieve her.


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## Horlics (Sep 27, 2011)

Tammydog said:


> Where's all these properties to rent. We have just contacted several agents for a 3 month and maybe 6 months rental from beg July this year along Costa Blanca South. And they have nothing available as all their properties are rented out for the season?
> Or are they just saving them for the higher holiday rental prices? We only want to around 600 euros per month at the most?


Yes, they are saving them for the holidays. In Javea a 2 bedroom apartment in a good position will be 600 for a week, and everybody I know who rents (including my immediate neighbour and a close friend) manages to let out at their peak season rates for between 8 and 10 weeks of the year. They make in 10 weeks what it would take 10 months to make at long-term rates.

That said, if you are flexible about position, I'd recommend taking a look at Airbnb. Do a search on properties with availability across your entire date range and see what's available (I just did... and there are 204 in Santa Pola available for 3 months starting July 1st - according to the site... some will not be maintaining their calendars). The first price you see will be more than the 600 you want to pay in most cases but some might discount.

The way the site works is you make an enquiry at which point you get into dialog with the owner, and you are able to make an offer. If the owner accepts the offer the system enables him/her to setup a special price for you, which you can then book at.

I've given made this suggestion to 2 people in the past and both got something sorted within a day.

Good luck with finding something.


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## Tammydog (Mar 7, 2015)

Thanks that's some really helpful information. I will check it out thanks. But going back on thread. The rental returns seems quite good to me then? But I'm not that great on finance. I will that to the pros I think!


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## Pesky Wesky (May 10, 2009)

Tammydog said:


> That's what we are aware of but if they get rental for long term it is normally cheaper. We only need a little place for 2 nothing fancy. But guess there seems to be a bit of boom this year from what the agents a telling us. So may pay us to stay at our sons for summer and come over in the Autumn. But really want to buy to live and need to get timing right. One agent we have dealt with reckons he sold 59 properties last month. And judging the people viewing when we were there. I not sure but I don't think I disbelieve her.


Long term including the winter months maybe, but long term for the summer doesn't make economic sense, at least in the popular areas of the south of Spain. (And I suspect in pretty much all of the country)
Would the owner of a holiday let in the UK rent out for the whole of the summer what he can get in a week? I don't think so


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## Tammydog (Mar 7, 2015)

Yes I can see that. But there is not a glut of properties here. Also we would be paying the utilities long term. Short term it is included normally. But suppose I would want to make the most out my investment so I do appreciate the facts. But I may need to rent for much longer or may decide to rent only. I just want to be sure. Sort of try before I buy so to speak? Without using too much of our capital put aside to purchase our home. If that's what we decide. I going to check out the previous recommendation. See what I can find out.


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## baldilocks (Mar 7, 2010)

Tammy. Do as much research as you can with the aid of the internet so that you know what the climate will be like (it varies quite a lot over short distances because it is affected, as much as, if not more than, by altitude). For example, we live at 723m and our max today is 25°, 40 km North of us at 511m it is 6° hotter and 120 km northwest at 106m it is 9° hotter still. Unless you are looking at a modern house you are unlikely to find central heating or insulated/cavity walls so it might be quite hot in summer and cold in winter. Decide whether you want to be near other Brits or expats in general? do you want seaside, town, city, village, near the costas, inland, up a mountain or on a plain? Beware of river valleys for flooding reasons (they are also often hotter in the summer and frost hollows in winter). Do you need to be near schools? airports (bear in mind that while there may be low-cost flights from an airport close to where you fancy, it may not always provide a service because some budget airlines depend on a subsidy from the local authority and if that is withdrawn (although the flights may usually be full) the service may stop and the next nearest airport offering flight to where you want to be may be 200-300km away? Do you want a town house, villa on an urbanisation (with all its potential problems) or on the campo (which offers yet another set of problems)? Do you need to be near where you can get English supermarket fare? etc. etc.


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## Simon.J (May 1, 2015)

Tammydog said:


> Yes I can see that. But there is not a glut of properties here. Also we would be paying the utilities long term. Short term it is included normally. But suppose I would want to make the most out my investment so I do appreciate the facts. But I may need to rent for much longer or may decide to rent only. I just want to be sure. Sort of try before I buy so to speak? Without using too much of our capital put aside to purchase our home. If that's what we decide. I going to check out the previous recommendation. See what I can find out.


I'm new at this but we have just rented a property from here for six months. 

They have been quite helpful if a little slow compared to AU/UK agents but we have found a choice of properties available for long term rent.

Hope that helps.


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## Tammydog (Mar 7, 2015)

Thanks for your advise. Much appreciated. I do spend about hour or more a day researching...minefield? This has been a lifetime thing as explained on this site before we were about to buy 10 years ago and site shut down 2 days before completion. Spent 4 years back and forth with courts. Spent 10 years previously planning prior to the world recession. I think Spain is not going to be cut and dried and a lot of intrigue still. But the only way I feel for us to learn is to be there all the research now we are retired is only wasting our precious time as we get older. It surely can't be so complicated if so many of you are still there enjoying life. And we just want a nice little easy to run home....whatever or where ever in the the warmer areas. So I have taken note of your advise thanks. Best if we are there hopefully renting at first. As being there is the only way we will know if it is right for us. Found a few things possibilities today thanks to help from this site. But need to await completion on our UK Home still. Before committing to our new hopefully new life. Warts and all! We are very committed people though!


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## Tammydog (Mar 7, 2015)

Ps meant to say no don't want English supermarkets as Spanish supermarkets are so much better. The Spanish diet for us along with a Spanish way of life for our health and wellbeing is paramount.


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## Tammydog (Mar 7, 2015)

Thanks I used to live in Aussie many years ago. Let me know where you are and who was your agent? You can Pm me if you like?


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## Matt Flynn (May 10, 2015)

Well dear Jo, Mr Horlicks, and all you others, I would just like to say thank you for all of your super helpful advice about the Spanish property market and after much deliberation and research we have decided to buy in this country, namely firstly Birmingham.... Two fantastic looking 1 bed flats for 80k each with a healthy return and also one in Spain but as a long term investment but.Maybe not a two or three bed as there does seem to an oversupply which they are trying to get rid of.
I think there is still a storey to tell about this Spain property thing, it all seems a bit shady?
Anyway I'll stay I touch and let you all know!!! :smile:


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## Horlics (Sep 27, 2011)

Congratulations on the decision and good luck with it. I bought in Birmingham a couple of years ago and it's worked out well so far.


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## Matt Flynn (May 10, 2015)

Well let's see Mr Holics, again we thank you for your advice and I'm glad your rentals are working out for you.
Just one more question for all you out there though;
I restore jewellery, items I can take with me and are quite portable. So if I decided to take my work with me to Spain would I have to pay tax even though my business is registered here in the UK?


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## snikpoh (Nov 19, 2007)

Matt Flynn said:


> Well let's see Mr Holics, again we thank you for your advice and I'm glad your rentals are working out for you.
> Just one more question for all you out there though;
> I restore jewellery, items I can take with me and are quite portable. So if I decided to take my work with me to Spain would I have to pay tax even though my business is registered here in the UK?


As you will be working in Spain, you will have to declare yourself autonomo (self-employed). This will mean making a tax declaration here and paying SS (NI) here - a fixed sum of around 260€ per month!


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## Matt Flynn (May 10, 2015)

Outrageous!!!!! But thanks anyway for your reply


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## Matt Flynn (May 10, 2015)

Ok so now realistically thinking that we're not going to earn an income over there due to the excellent advice we have been given on here.
But we would like to buy somewhere as a long term investment.... Question is where would everyone choose between the Costa deal sol and the Alicante area? You seem to get a lot more for your money the more North you go?


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## Horlics (Sep 27, 2011)

There are nice and not-so-nice places on the CDS and around Alicante. You can spend a lot or a little in both places.

But if it's purely a long term investment, I wouldn't be thinking about whether you're getting more for your money. I'd be entirely focussed on the potential gain.

You have a massive research job on your hands. CDS to Alicante must be 1000s of kilometres of coastline.

Other things to consider:

If you're not living in it, you're not going to leave it empty (because if you do, it won't work as an investment), so it must have rental potential. Which means; close to airport, nice setting, pool (whether private or communal), amenities close by, and probably close to the beach because it makes it easier to rent out if it is.

In your position I would only do this if I wanted personal use of the place for several weeks a year. If it's purely and investment, I wouldn't do it. Just add another to your Birmingham purchases.


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## Matt Flynn (May 10, 2015)

Well I was thinking about buying another place in Birmingham!! Also I hear Bristol is quite s good area for waterfront investment too,
As to your reply yes we are thinking of using it quite a lot for personal holidays and to just keep it ticking over trying it out fir a few weeks in the year.
After all is said on here though I can't help but get a bad feeling about CDS, I feel it's been over developed and they are doing anything to get rid of the properties.
Thanks Mr, Horlics, let the research begin!!! :smile:


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