Football Village Spain Rental Potential
Apartments at The Village can be rented out in three ways:
1. Self Rental (with help from the football clubs)
You should be able to cover all your costs from around 16 weeks rental per annum, split across the year. Similar properties in the area currently rent for €800 per week in the peak 12 weeks of summer. You can choose to rent out to friends and family, employ any of the many agencies in UK and Spain or even take advantage of the football clubs’ offer to promote properties for rental on their sites (providing them with a commission for the privilege!)
2. Through the onsite Management Company
It is a legal requirement for The Village to have its own onsite property and rental management company. Although this has not yet been confirmed, the developers are currently in negotiations with a number of international hotel and management companies. Owners at the Village will have the choice of self rental or passing over to the management company to rent out on your behalf (for the weeks that you do not wish to use it). The management company then promote all the apartments on the development through their network of travel agents and rental companies and the rental is pooled between all the owners participating. The existing schemes in operation guarantee a return of between 3-5% of the property purchase price plus all costs covered, with an upside if certain targets are reached. The basic guaranteed return should be enough to cover all mortgage costs.
3. “Apartmentos Turisticos”
The planning classification of the apartments is under a tourist regime which is set up to encourage rentals and therefore tourists to the area as opposed to owner occupied properties. This brings with it a number of benefits for investors.
Firstly, the developer must engage a management company to manage the day to day maintenance and upkeep of the properties as well cleaning and rental management. Whilst the management company is not yet finalised but this is expected to be in place within the next 12 months, it will be a major benefit for buyers at The Village. It is expected that in keeping with other developments under this regime, the management company will offer a “guaranteed rental” package, where the owners are allowed 6 weeks annual use and the other weeks are handed over to the management company to rent out through travel agents.
Similar “guaranteed rental” packages on other developments range from 3-5% of the property purchase price as an annual return along with all management costs paid for. The management company will be incentivised to offer some form of guarantee figure, otherwise there is no incentive for buyers to hand over their property. They might as well rent it out themselves.
Secondly, “apartmentos turisticos” are classified as commercial property in Spain. This opens up a potential saving on VAT (Spanish IVA). All property in Spain is subject to a 7% tax on final completion. Commercial Property attracts 16% but is fully reclaimable. We have developed a package for buyers which will pay this and claim it back on their behalf, so the client does not see it. This will represent a saving of 7% against any other apartment which does not have this planning classification.
For further information contact us
|
