Many Northern Europeans have been dreaming of moving to Spain since the first package holidays put the country on the map back in the Sixties. Since then the country has become and firm favourite for holiday makers and expats looking to make a better life for themselves in the sun.
Over the last ten years, thousands of properties have been snapped up in the key holiday destinations as buy to let investments and those early investments have seen an excellent year-round return, especially on the Costas.
This early success led brought more investors and developers keen to let out their properties and has created a highly competitive holiday rental market throughout the country. The holiday rental market has been hit hard by the global recession as fewer people holiday abroad and have a vast array of holiday accommodation to choose from. Interestingly, the long-term rental market is growing and we are actually seeing a lack of high-quality, well priced long-term rentals in the most popular areas.
As a result, more and more homeowners are now looking to rent property long term. This is not only because of the slowdown in the property sales market and the inability to sell property so easily, but also because long-term rental is a good option to consider when you compare the return on holiday rentals with the return on a long term let.
On a two-bedroom apartment, for instance, you could earn between 500 and 800 Euro per week as a holiday rental, and between 700 and 900 Euro per month as a long-term rental. Even if you normally manage to achieve 10-12 weeks of holiday rentals during the year, the long-term rental option still compares very favourably. What’s more, the long term rental option means a steady stream of income throughout the year, and also the possibility of that income continuing if the tenant renews for another year.
Many of our owners who had previously rented out for holiday lets are now considering the more stable long-term rental option, and if they were only using their Spanish holiday home one or two weeks a year, they now rent a separate holiday home so as not to miss out on their annual holiday.
Renting out long-term basically means contracting a tenant to live in your home for an agreed fixed period of time. That time period can vary, but in Spain it’s typically between six months to two years. The tenant will pay you a fixed rent each month and pay all the utility bills during their tenancy. This offers you the security of having rent coming in throughout the year, without the hassle of constantly changing rental clients.
It’s certainly the right time to rent property long term. With the continuing fall in property prices, more people want to ‘try before they buy’, and will rent long-term until they find the right property to purchase at the right price. This means that despite the slowdown for sales, the long-term rentals market is buoyant, with a steady year-round demand for quality long-term accommodation.
If you want to have a steady income throughout the year and don’t want to see your property sitting empty, then this is the way to go. It’s true that there may be more money to be made per week in holiday rentals, but this is seasonal. If you own an apartment it’s very unlikely that you will have more than 10-12 weeks rented each year due to the quantity of properties and the level of competition.
HomeRentalontheWeb is highly experienced at taking care of properties on behalf of homeowners in Spain. We can find you tenants, as well as managing the whole process of contracts, deposit collection, reference sourcing and dealing with tenancy problems when they occur – which means you can enjoy the rewards of your long-term rental as we take the strain!