- Spanish off-plan investments can offer the investor the ability to achieve returns between 20-100% in just 24 months.
- Your generated profit can be free from capital gains tax if sold prior to completion. Our experts will advise you about this strategy.
- Keeping your property for a number of years will allow you to benefit from excellent rental income opportunities. Meanwhile you can enjoy a beautiful Spanish holiday home and watch property is appreciate in value..
Off-Plan in Spain
Whether your off-plan purchase in Spain is for a villa, townhouse or apartment in Brazil, many developers will offer beneficial payment schemes. Through the IPIN Global (IPIN) we carefully vet these offers and work with only the most reputable and secure development companies that operate in your favoured location. Payment schemes currently on offer allow you to buy property off-plan, ie. before or during construction when the price remains low, with down payments of around 30% of the property price.
By the time the property is finished, prices rise due to market forces and the greater general appeal of a completely finished property that is ready to move into. Investors therefore sell the property on to another property purchaser and in doing so, enjoy some excellent returns of around 20%, whilst never having paid the full purchase price.
Investors should however exercise due diligence and choose wisely, making sure that their off-plan property in Spain is located in an area where they will resell quickly and easily or where there is a high rental demand for their buy-to-let option. With an off-plan investment, even in the “worst case” scenario if the property cannot be sold upon completion, the final balance due can often be financed by the developer himself, typically over 4 years or more. Furthermore, the rental income may pay off the finance of this loan and yield further eventual return on investment.
How can property be cheaper if bought off-plan – How does it work?
In order to limit financial risk and debts, the developers of any project will wish to sell units off-plan. They understand that if buyers cannot see a physical property at the beginning, they will demand a lower price, while relying purely on the developer’s reputation, the property location, artistic impressions and computer simulations on which to base their decision to purchase.
In addition to the excellent off-plan price, some highly beneficial finance structures are in place. You sometimes need to pay around 30% of the purchase price in the form of a deposit, while the rest is payable upon completion. This may be financed by a mortgage if necessary.
If you decide to purchase off-plan investment property in Spain, you will need to decide which strategy you will adopt to achieve your return on investment. Our experts will help you to choose the most appropriate plan, creating an investment programme suitable to your needs, whether this is "pure investment" or a "buy-to-let" strategy. We will also assist you in finding the most appropriate location to suit your investment needs.
Maximizing Profit From Off-Plan Investment in Spain
The Process of Price Increase
- Purchasing early
Prices never remain low for long and, as construction progresses, prices begin to rise steadily. In Spain, as in any other market, it is important to buy your villa, townhouse or apartment as soon as possible during the early stages of development when prices remain very competitive but are already beginning to rise. Early investors will invariably see the greatest returns.
- Purchasing the best units
Early off-plan property purchase in Spain allows investors to choose the most sought after properties on any given development. The best units always offer higher capital appreciation in the smallest time frame and can often demand the greatest rental incomes. Penthouses are often firm favourites.
- Price increases as development matures
As the development begins to be constructed, the value of the units begins to rise. A completed show home is normally available for viewing at this stage, while buyers are taking less of a risk as they now do not need to rely entirely on plans.
- Price appreciates as more units sell
As more units are sold, the price of the remaining units rises. Units sell faster when buyers are able to physically see them. There is often a phase payment structure in place which mirrors the increasing value of the properties. To the early investor this means that, should you decide to sell your property, it will be worth considerably more at this stage than when you made your initial purchase and paid the 30% deposit.
Investors are currently making some excellent investment choices in off-plan property in Spain and we are dedicated to helping you pick the best investment options suitable to your particular needs. In this way, you can generate personal wealth through safe and intelligent off-plan investment.
IPIN offers selected investment opportunities in Spain. You can find out more about the IPIN Global (IPIN) or gain access to some great opportunities by joining now for FREE