Unfortunately, finding good investment property in Madrid can be difficult. Nevertheless, the market is showing improvement since 2016 where it was experiencing difficulty.
There are a number of important considerations before investing in property in Madrid. For example, are you buying to sell eventually for profit? Or are you looking for a property that you can gain monthly income from as a rental? In this post, we talk about both of these options.
Certain neighbourhoods have de-valued particularly badly over the past couple of years. For example, Barrio Salamanca and El Viso. This is because the market has been turbulent. It is true that generally, no matter what city you look at, house prices remain high in the most desirable locations, no matter what is happening in the market. Resultantly, these areas are unsuitable for investors that are hoping to purchase at a reasonable price, then sell later on for a profit. Instead, investors should look at poorer Madrid neighbourhoods such as Vallecas and San Cristobal.
If capital gain is what you are looking for in your investment, you’re best looking at the average neighbourhoods around Madrid. Modest earners typically populate such neighbourhoods. And are decent, safe places which to reside. Homes can often be purchased reasonably. And be sold at a reasonable profit. Alternatively, if you would consider a project, it is worth purchasing a property that requires refurbishment. As it can be sold for a reasonable gain later. If you are looking for properties such as this, consider neighbourhoods such as Tetuan, Barrio del Pilar and Hortaleza.
Madrid is the ideal location for cash flow investors to set up rentals. This is because rents in Madrid have overtaken price increases. If you are looking for value for money, it is worth looking at poorer neighbourhoods in Madrid. For example, Punte de Vallecas.Where investors can yield up to 10%. However, be aware of the risks. E.g. renting to tenants that struggle to pay their monthly payments.
Investors that are interested in luxury rentals may want to consider La Moraleja. Rents can be expected to be in the range of 2000-6000 per month. Such rentals are easy to manage and guarantee high income month to month. Alternatively, you may want low risk but high value for money. In which case areas such as Tetuan, Horteleza and Barrio del Pilar could be an ideal choice.
If you are an investor that wants to purchase property at a reasonable price, then sell on for a profit, your best bets are the neighbourhoods of Vallecas and San Cristonal. Alternatively, for those interested in capital gain, consider the ‘average’ neighbourhoods around Madrid. Which are considered safe, decent places to live. Or for investors that would like to earn profit through refurbishing property, consider areas like Tetuan or Hortaleza. Investors considering rentals have two options. Either luxury property, or poorer neighbourhoods. For poorer neighbourhoods, yields have increased by as much as 10%. However, be aware of risks such as tenants not being able to pay their rent. Luxury rentals can guarantee high yields per month. However, if you are looking for value for money, low risk investment, consider barrio del Pilar, Tetuan and Horteleza.
Knightbridge Ventures can help. Either make an appointment or request a free investment pack by scrolling to the bottom of this page and selecting ‘Request Free Investment Pack’. We look forward to dealing with your enquiry.