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Moving to Spain: Should I rent or buy on the Costa del Sol?

Whether you’re a frequent visitor to the Costa del Sol or are thinking of moving to the area, you need to decide whether to rent or buy a property.

Moving to Spain: Should I rent or buy on the Costa del Sol?
Photo: AFP

Both options come with advantages and disadvantages. And of course, the ultimate decision will depend on your personal circumstances, finances and medium-term plans.

In this article Celeste Alonso, manager of The Property Agent and an expert on real estate on the Costa del Sol, explores the pros and cons of renting or buying real estate on the Costa del Sol and then crunches the numbers.

The advantages of buying property on the Costa del Sol

If you plan to visit several times a year or make the Costa del Sol your permanent home, buying property makes a good option for the following reasons:

Stable and convenient

Owning the property you live in adds stability to your situation. And if it’s a holiday home, you can leave your stuff in it from one visit to the next.

Financial profit

Buying a home should reap you rewards in the medium to long term because the underlying trend in property prices is always up. But to make a profit, you need to sell at the right time.

Personalisation

You can do what you like in your own home to adapt and furnish it to exactly what you want. If you’re buying off plan on the Costa del Sol, you can even customise the property at construction stage to suit you.

Leverage

When mortgage interest rates are low (as they are now) Check this article  you can get much more for your money when you buy.

Haven in the sun

And last but definitely not least, you own a home in a place with 320 days of sunshine a year!


Photo by Ivana Cajina on Unsplash

The disadvantages of buying real estate on the Costa del Sol

But it isn’t all about benefits – buying property does have its drawbacks too. They include:

High initial costs

Buying a home in Andalucia involves taxes and fees on top of the purchase price. And they’re expensive – budget for between 10 percent and 12 percent extra.

The counterbalance? Think of your purchase as a long-term investment so you have time to recoup buying costs.

Location inflexibility

You may discover you don’t like the location you’ve bought in.

The counterbalance? Research the area carefully before you buy and use an agent with specialised local knowledge.

READ ALSO:

Costs are all yours

Owning a home inevitably involves maintenance and upkeep that can be costly. And those costs are all yours.

The counterbalance? Buy a new-build property on the Costa del Sol.

The advantages of renting real estate on the Costa del Sol

If you’re not sure where to buy or confident that you’re going to stay on the Costa del Sol, renting a property offers a good temporary solution because:

Low initial costs

You only need one to two month’s rent plus the deposit and your initial costs are covered.

Flexibility

You have no tie to the rental property because you can leave with a month’s notice.

Did you know? The cheapest townhouse and villa rentals on the western Costa del Sol start at €900 a month.

The disadvantages of renting a property on the Costa del Sol

On the other hand, rentals have the following cons:

Uncertainty

Living in the property depends on a contract and the landlord might not renew it.

The counterbalance? Look at rent-to-buy options.

Zero wealth creation

Your monthly rent goes into the landlord’s bank account and adds nothing to your personal wealth.

The counterbalance? Make renting a temporary solution and plan to buy within 3 to 6 months.

Did you know? The most expensive villa rentals on the western Costa del Sol reach up to €16,000 a month.

How much does it cost to buy real estate on the Costa del Sol?

While renting offers a good temporary option, the balance ultimately tips in favour of buying. To give you an idea of what you can buy, we’ve sourced the cheapest and most expensive properties on the market right now.

The cheapest property

This comes as a very pleasant surprise – 2 bedrooms and 2 bathrooms over a spacious 74 square metre apartment plus sweeping sea views and designated parking space. All within a 10-minute drive of Estepona and Sotogrande. Yours for just €97,500. Find out more

The most expensive property

At the other end of the spectrum, this golf-front villa takes premium living on the Costa del Sol to new heights. Six bedrooms and seven bathrooms spread spaciously over 1,351 square metres. And you’ll also enjoy breathtaking sea views, marble floors, Mediterranean gardens and a pool. Plus all the extras available to residents at Finca Cortesín. Yours for €11,000,0000. Find out more

This article has been written by Celeste Alonso, who runs The Property Agent specializing in real estate on the Costa del Sol. If you are looking for property on the Costa del Sol contact her for HERE. 

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Member comments

  1. Having owned property in France and not being a full time resident there I would add squatters to the list of disadvantages. We were relatively lucky as neighbours informed us quickly and the police acted. I would never buy another property in France or Spain without being a full time resident

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PROPERTY

REVEALED: The cheapest most in-demand areas in Spain to buy a house

If you're considering making the move and buying property in Spain, but don't fancy purchasing in a rural village in the middle of nowhere, you should know where the cheapest, most in-demand parts of the country are.

REVEALED: The cheapest most in-demand areas in Spain to buy a house

If you’re thinking about relocating, Spain is a fantastic place to do it. Foreigners have been moving to Spain for decades, not only for its fantastic food and weather, along with a laid-back lifestyle, but housing is generally affordable – if you know where to look.

Though the rise in the Euribor has sent interest rates spiking, house prices in Spain are expected to flatten somewhat in 2023 and it could be a good year to find a bargain, depending on your financial situation.

Knowing what type of house you want and where in Spain you want to live is one thing, but knowing the cheapest, yet most in-demand parts of the country could really help you narrow down your search.

Fortunately, Spain’s leading property website Idealista has put together a list of the most ‘in demand’ municipalities of Spain and where you can find the most expensive and, more importantly for the house hunters among us, the cheapest municipalities of Spain to buy property.

It’s based on data from the last quarter of 2022 and is the average price of housing in towns with more than 1,300 sale announcements and costs valued at more than €1,100 per square metre. 

You can find the ten cheapest areas of Spain to buy property by average price below, but it’s worth noting that Idealista did these rankings by average price across the entire municipality, so there are likely individual towns and villages dotted around Spain where prices are significantly lower.

That said, this list gives you a good idea of the areas to look out for.

READ ALSO:  What will happen with property prices in Spain in 2023?

The 10 cheapest municipalities in Spain to buy property 

Santa Pola (Alicante) – Santa Pola, in the Alicante province, is the cheapest most in-demand municipality to buy a house, according to Idealista’s rankings. The average price for a house in Santa Pola costs just €151,796, though this may come as a surprise given its prime location in a foreign hotspot on the sought-after Costa Blanca. The main town of Santa Pola itself is a small beachfront community with a population of around 35,000. It also has a large foreign population and is a short drive or bus away from both Alicante and Elche.

Ourense (Galicia) – Next on the list is Ourense in Galicia where the average price is €154,941. The municipality is home to several towns and villages, surrounding the main medium-sized town of Ourense itself in southern Galicia. The town has a population of around 105,000 and is a little over an hour’s drive from both Santiago de Compostela and the coastal city of Pontevedra.

Oviedo (Asturias) – Third on the list is the municipality of Oviedo where you’ll pay an average of €154,968 for a property. Another area in northern Spain, the main city Oviedo itself, which is the capital of Asturias and has a population of 220,000. It sits between Cantabrian mountains and the Bay of Biscay. It’s known for its picturesque medieval old town and impressive architecture. 

Jerez de la Frontera (Cádiz) – Properties cost an average of €155,563 in the municipality of Jerez de la Frontera, or Jerez as it’s commonly referred to. It’s located in the Cádiz province of Andalusia and is a real piece of ‘traditional’ Spain. Jerez city is a decent-sized place with a little over 200,000 people and is known for horses, flamenco dancing and sherry, as well as the Alcázar de Jerez, an 11th-century fortress that harks back to Andalusia’s Moorish past.

READ ALSO: Is it better to buy or rent in Spain right now?

Torrevieja (Alicante) – Another municipality in Alicante and another incredibly popular with foreign homeowners. Properties here go for an average of €155,787. Torrevieja itself has a population of 82,000 and is another coastal town, but also has nature trails and salt plains nearby.

Murcia (Murcia) – Murcia is often overlooked, wedged between Alicante and Andalusia, but you could grab a bargain here with average prices of €157,119. Murcia capital is a bustling city of almost 450,000 people, and is strategically placed for trips to the Costa Blanca, Costa Calida, Costa del Sol, and Costa de Almeria.

Parla (Madrid) – The municipality of Parla lies just 20km south of Madrid and the town of the same name is home to 130,000 residents. It’s a great commuter area for those who work in Getafe or the capital. A house here costs an average of €160,652. 

Salamanca (Castilla y León) – The municipality of Salamanca surrounds the capital of Salamanca in Castilla y León in northwestern Spain. Buying a property in this area costs an average of €162,909. The main city of Salamanca is known for its university, which is the oldest in Spain and dates back to 1218. Understandably, much of Salamanca’s roughly 150,000 residents are students, which gives the town a lively atmosphere.

Burgos (Castilla y León) – Another northwestern Castilla y León municipality, is Burgos has around, where you can buy a house for just €163,164. The city of Burgos has around 180,000 inhabitants and is known for its medieval architecture and grand cathedral. 

Dos Hermanas (Sevilla) – The second most populous municipality in the province of Seville, properties cost an average of €163.274 here. The Andalusian town is just 15km south of Seville, making it great for commuters or those who want plenty of culture nearby. 

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