We can’t avoid the fact that the coronavirus has left not just Spain, but the whole of wider Europe, in a state of economic disarray. But the forecast isn’t all doom and gloom, particularly for the Spanish property market, which is expected to recover much faster than any other aspect of the Spanish economy. In fact, thanks to continued foreign interest, it has been suggested that Spanish property remains a safe investment for those looking to invest wisely in times of uncertainty.
A Market Reopened
There was an immediate downturn of property sales in Spain once the region was hit by COIVD-19, as notaries and estate agents across the country were asked to close their doors in order to prevent the spread of the virus, meaning that the property market was effectively closed. But, in recent weeks, the property market has re-opened and we have good reason to be positive that the demand for property will rebound quality, particularly in the Costa del Sol. Enquiries from global customers hoping to view properties once their lockdowns are over have held steady, and that means we can expect transactions to resume soon.
Unlike other financial crisis (most notably, the financial crisis of 2008) this is an indiscriminate crisis that has affected everyone equally, and because its impact has been predominantly a health one, recovery should occur much more quickly. What’s more, the government is committed to protecting the economy from the impact of Covid-19, meaning that there is more economic support than there has been in any previous financial crisis.
Use the Leverage of a Mortgage
There isn’t a bank in the world that will lend you money to buy stocks and shares. However almost every bank on the high street will lend you money to buy a property, in the form of a mortgage, provided you have a deposit available (usually at least 20 percent of the property purchase price). A mortgage typically offers you lower interest rates over a longer period of time, making it one of the best ways to borrow money. This helps ensure that property is a safer investment for your portfolio, as the full value of your investment won’t be realised until you choose to sell your property, meaning that if the value of the property is low when you buy it then that’s only good news for your long term financial gain.
Using the leverage of a mortgage will help you to minimise the impact of your investment whilst maximising your potential long-term output. Put simply, there is no safer investment at this time that purchasing property, particularly in a busy and popular market such as the ex-pat regions of Spain.
Property is a Tangible Asset
Stocks and shares have traditionally formed the vast majority of many people’s personal investment strategies but these can also be risky in times of economic uncertainty. Property is a tangible asset, unlike stocks and bonds, which means that even in a worst-case scenario, it can provide a return on investment. Investing in property will help you to both diversify and minimize the risk of your investment. Property can be rented out to generate an income, and once it is a part of your portfolio you can also hold onto it, enabling it to increase in value and turn a profit in the long term. Short term market falls and rises become almost irrespective if you are using real estate as a long-term investment: there really is no safer place to put your money right now. Because even if the value of your property does take a very temporary short-term dip, forecasts suggest they will reach pre-Covid 19 levels within the next year or more.
Above all, it’s important to remember that the Costa Del Sol remains an incredible place to raise a family, to spend your retirement, or to own a holiday home. If the Covid-19 crisis has taught us anything it is that life is short and there’s no time like the present to make the changes that you want to make. Spain is a great place to live, and Spanish property is a great investment at any time: so if you’re ready to make the move then there’s no time like the present!
Are you ready to buy property in Spain? Whether you’re looking for a home of your own or an investment property, our locally based property experts are perfectly placed to help you find the right property to meet all of your criteria. Why not get in touch with the team today?