The best cities to invest in Property in 2018

Considering that in Spain, people most generally prefer to purchase their houses rather than renting them, one might think that this option is more profitable for us.

It is, in fact, the uncertainty of the markets which may make us to want to find a better choice to invest in, and the purchase of a house emerges as a right option, even more so considering that the purchase of a property for its subsequent rental is on the rise in recent months.

The smaller size apartments seem the most interesting ones, and in most province capitals, the average size is around 55 square meters. Nonetheless, there are also exceptions, such as Lleida, where the average flat for sale has around 160 square meters.

Obtaining the higher profitability out of an investment depends heavily on a number of factors that we must keep in mind when buying a property for, afterwards, renting it, such as if it has an elevator or how many rooms it has or the condition of the house.

The cities that show higher profitability and a significant positive trend with respect to the previous year are Madrid, Málaga, Valencia and Alicante.

The housing shortage in the capital city centres makes people increasingly interested in buying in the ‘suburbs’; this is what happens, eg, in Madrid. In the case of Barcelona, ​​the interest is also shifted to residential areas such as Baix Llobregat and Vallés. Valencia and Alicante, though, have very competitive prices in their downtown areas and Málaga is noteworthy due to the relevance of its district of ​​La Malagueta.

To avoid unnecessary risks, best advice is to resort to the help of experts. They will assess all the data and will recommend you the most suitable investment to your profile and to your needs.

Taxes foreigners must pay in order to acquire their housing in Catalonia

In Spain, any foreigner can acquire a property in the same way a Spanish citizen does, however, a non resident person needs to meet several other requirements to carry out the operation

Firstly, it will be necessary to have the Foreigner Identification Number, which can be obtained in both the country of origin and Spain. Otherwise, it´s not necessary to have an account in Spain, but by opening one, the purchase management can be much easier.

The purchase of a house is charged with several taxes:

  • The Value Added Tax (VAT), in case of new houses or first transmission (10%).
  • The Property Transfer Tax, in case of second-hand residences or second transfer. The tax rate in Catalonia is 10% if the property value doesn´t surpasses a quantity of 1.000.000€ (it would be 11% from here on out). It must be paid in case VAT is not applied in the transfer.
  • Documented Legal Acts Tax. It must be paid in case the house is purchased and VAT is applied and if is purchased by means of a mortgage.

In addition, there are several other expenses to take into account, such as the Public dead in the notary and the registration of the deed in the Property Registration Office. In case it´s necessary to request a mortgage, both the valuation and public notary must be included within the mortgage taxes.

Over the year, it would be necessary to face other taxes too: Real State Tax, the Wealth Tax– as the case may be-, Personal Income Tax or, if the foreigner doesn´t live in Spanish territory permanently, it will be necessary to pay the Non Resident income tax.

In order to avoid any further complications, the ideal would be to put oneself in a property agent´s hand, since this person will guide you during the whole process. From the choice of the more suitable house for you to make easier any purchase – selling procedure.