Buying Spanish property off plan with the intention for selling on prior to completion is an great form of investment, and has the potential to show good returns on your capital invested. However, like ALL forms of investment that offer higher than normal returns, there are always risks attached. It is for this reason that our investment group has worked hard to bring you the best property for sale in the Canary Islands.
The Primary Risk of Buying Canary Islands Property
Your property / contract is not sold, meaning that you will have to take title of the property, however, the final balance can be mortgaged, be aware though, this does though entail extra costs, like purchase taxes, lawyer’s and notary fees etc. on completion of your contract.
The moral of Buying Canary Islands Real Estate
If you are not in the financial position to take the title deeds of the property, and the property is not sold on, do not buy property for turnover!
Choose your Canary Islands Estate agent carefully
Is your agent still going to be around when you want to sell your property / contract on”? Most Agents talk of customer care, and after sales service, ours has been proven.
If you are buying property for sale in Spain for Turnover, always buy your unit unit at the beginning of the promotion with the first price release. Why?
You have first pick of the best available properties for sale at the best possible price – meaing that when you sell, you can maximise the profit obtained from the sale of the property.
Buying property for Turnover or for investment is a partnership. It is a partnership between your agent and you, the investor, because for every property you buy, your agent has the potential to make 2 sales provided that they are committed for the long term, because of this, we value trust and treat all our customers with the utmost respect and care, we are in for the long-term!
What are the financial benefits?
As a general rule, with the right development, you should see, conservatively, an estimated 15 to 20 % total capital growth, which translates to a potential 50% return on capital invested! In general, you should only investing about 30% of the original purchase price of the property.
Example: Capital cost 100,000; deposit 30,000; growth 15%
100,000 x 15% = 15,000;
Deposit 30,000 + return 15,000 = +50% and total initial investment returned
Original investment 30,000 + 15,000 = total return to investor once sold 45,000
The figures above are simplified for the purposes of the explaination, and should only be used for guidance, and are not a guarantee. Given the scenario above, you also need to discuss with your agent selling fees, tax liability, etc. If you would like to speak to one our in-house FREE financial services representatives, simply complete the contact form and our agent can guide you through the entire process.
How long should I have to tie my money up for, as a general rule?
You can expect for the money to be tied up for a minimum of 18 months to 2 years, however, this is though determined by the build programme of the developer of your property (which, by the way, your agent has no control over).
If you require any specific details about a development or would like to see what property for sale in Spain is hot at the moment for investment, you can contact us now.
Like all investment opportunities, if you cannot afford to tie your capital up for a minimum of two years, do not do it. There is never a free lunch, despite what people would have you believe.