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FSBO Advice Centre
Tips on Choosing the Property Abroad
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| Finding out what you can afford should be
the first step to buying a home in Spain, which can
be done by applying for a home loan and have it accepted.
This step will help you narrow your search for both a neighbourhood
and particular houses. The approval is a simple calculation
that considers several factors, but primarily your income.
The mortgage formal approval by the lending entity enables
you to have a feel of the price of the home you can
afford, knowing that, where approved; you will be able to
borrow a percentage between 60 and 80 per cent of professional
valuation price. |
Where to buy?
Most of the buyers of home in Spain
will have a choice of location as to where to buy. A
friend, a previous visit to the area or simply the fame
or notoriety of the city, town or rural area is enough
to form the choice. But a buyer will want to know, as
well, whether the location is in itself a good investment.
A precise answer in this regard is difficult. There
are locations where the rental value of the home
is high (Costa del Sol, Costa Brava, and Costa Dorada...generally
all tourist resorts). In the Marbella area, villas are
easily rented out in peak season with the high luxury
mansions out for rent at astronomic prices.
Rural areas have a lower demand for rentals, although
the regional authorities are increasing the financing
of many rural tourism resorts to make them more attractive,
not without success. There are areas which have consolidated
a growth and are secure investments. Others are in the
process of growing. Generally speaking, Spain is growing
from strength to strength in real estate investment
and predictions are that sales will shoot up in the
following years, with an estimate of 4 million people
investing on home in Spain and 600.000 European
families purchasing a second home only in Andalusia
in the coming years.
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Finding the right home
There are 2 main set of circumstances which
should be born in mind when looking for the right home:
Personal circumstances (family size, purpose of purchase,
funding availability, time spent in the home and many
more).
Property circumstances (size of home, price, views,
or interruption of these by a future development, easy
access, orientation, investment value, facilities in the
surrounding area, associated expenses and many more).
Making an assessment of those sets of circumstances blending
pros and cons to suit one's personal convenience is a
must.
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Buying a townhouse?
A townhouse is a good investment given
its all-year-round high demand. They require little maintenance,
have low running costs and are comfortable to live in.
Against this choice is the prospect of living door to
door with other home owners.
Buying a villa?
A villa is a choice for those seeking tranquility
and independence. They require a higher investment in
maintenance and the higher prices have the logical effect
on annual running costs. Countryside villas or 'fincas'
have low running costs, at times ridiculously low. These
however tend to be located at some distance from towns
or cities. For those buyers with a good amount to spend,
villas are the choice.
Buying a small project development?
It is happening in coastal resorts. Investment
buyers place deposits on all of the units of a project
development and put them for sale straight away. The investment
buyer then liaises with the project developer in order
that legal exigencies such as bank guarantees are met.
It is a cheap and safe way of investing and can give high
returns in a short time. Engaging a good real estate company
is a good choice when choosing this form of investment.
Buy a resale or a new sale?
From a strict investment point of view, new sales are
more promising in terms of making a gain when selling.
Resale’s have already been squeezed for a gain,
and thus the gain to be made is less predictable. There
are however no fixed rules in this respect, which makes
the gain predictions a bet for the future. Certain buyers
will necessarily choose a resale: villas are not normally
for sale from a project developer, although the building
restrictions in some areas and the demand for one-family
villas are encouraging developers to build these close
to other kind of developments. |
This page has been reproduced
with the permission of Antonio Flores Vila of Marbella
lawyers.
Disclaimer:
Bargain homes abroad does not accept any liability
for the accuracy of the above legal articles and are intended
as general guidance, it does not constitute legal advice,
nor should it be relied upon, you should always consult
a lawyer to discuss your own personal situation. |
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