Even when your economic situation allows access to homeownership, leasing can also offer advantages.
Now that the housing market is beginning to show signs of improvement in different parts of Spain, including on the Costa Blanca, again the question arises: what should I do before making an investment in a house to be used either for my permanent residence or a holiday home? Should I buy a house in Spain or should I verify that the house and the area I have chosen meets all my requirements? This question is difficult, especially for foreigners who decide to invest and retire in Spain.
On the one hand, investing in a home is vitally important financially. Renting is a much lower commitment than the purchase. It is true that many people who intend to buy in the beginning have many doubts, so to begin with they rent, taking a much smaller financial risk. Nevertheless, many tenants still wonder if it’s worth buying when they hear the statement that “renting is throwing money away”.
There is a middle ground, which many people have used, especially in times of crisis: called “rent to buy” -as long as the seller agrees to this-. But what does this option consist of?
The rent to buy purchase is a double or mixed contract, consisting of two subcontracts, one for the rental of the property and one for the purchase of the property. This allows the tenant to live in the leased housing for a certain period of time, after which they will be entitled to buy the property for a pre-agreed price from which the rent paid will be deducted, either in whole or in part from the final purchase price.
But you chose the option of directly purchasing a property. The property market is currently in a perfect state in order to invest, especially in coastal areas where there is an excess supply of properties, at relatively low prices. There is also the possibility to access fantastic mortgages with a low fixed rate between 2% and 3 % – 15 years high. It is true that unfunded investments are the most profitable option but it also more de-capitalizing.
There are several options available now that the housing market is starting to improve, especially also because banks are offering attractive credits. Everything depends in many cases on the needs and wishes of the buyer, and the good deals found on the housing market.