jerome1978 1 December 2019 Real estate news in Spain no responses

The most profitable rental housing in the city of Malaga is in Bailén-Miraflores and Puerto de la Torre

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Buying a house for the purpose of renting it is very profitable in Malaga.

In fact, investors are those who have pulled much of the car from the increase in real estate sales in recent years. According to UrbanData Analytics data, collected and analysed using specific computer programs in artificial intelligence, the gross profitability of the rental house compared to the purchase price is 6% in the capital of Malaga, a Percentage signed by any investor Keep in mind that Spanish bonds or interest rates are on the ground. In the capital, Bailén-Miraflores and Puerto de la Torre are the most profitable neighborhoods to rent a house.
This does not mean, of course, that these are the most expensive neighbourhoods.

Rent rises in Malaga

Renting an apartment in the Centre or in the East is more expensive and leaves more income for the landlord, but to analyze this profitability, it is important to compare the cost of the house and that of the rent. This study, carried out in conjunction with data from public and private institutions, shows that the gross profitability of rental stakes in Bailén-Miraflores and Puerto de la Torre was 7.8% in the third quarter of 2019, or 1.8 percentage points more than the Malaga average.

Renting homes is profitable throughout the capital, even if the second most interesting district is Ciudad Jardon, with a profitability of 7.6%. In the streets Carretera de Càdiz and Cruz de Humilladero, this percentage is 6.6%. Logically, the least profitable areas are those where soils are more expensive: East (5.1%), Historic Centre (4.6%) and Ensanche-Centre (3.8%).

Profitability up in Malaga

The purchase price continues to rise, but demand is beginning to be unable to pay for what is claimed and activities are slowing down. The price could therefore fall in the coming months but, for the moment, it has soared by 12% in the Ensanche-Centro sector, by 10.4% in the historic centre, 9, 5% in the East, 6.9% in Bailén-Miraflores and Puerto de la Torre, 5.8% in Ciudad Jardon , 3.9% in Carretera de Càdiz, 1.9% in El Perchel and Trinidad, 1% in Churriana and remained stable in Cruz de Humilladero. At the opposite point, house prices in the San Felipe Neri-La Merced region fell by 1.3% and in Victoria-Conde Urea by 4.6%.

Talking about percentages of price increases or decreases is an analysis of market behaviour compared to past periods, but it can be somewhat confusing. What is not in doubt is the price per square metre which, in the capital of Malaga, was 1,890 euros at the end of September, that is, a house of 100 square meters costs on average 189,000 euros.

Price per square metre district by district in Malaga

These prices vary depending on the neighbourhood. In the eastern zone, they reach 2,518 euros per square meter, compared to 1,449 euros in Bailén-Miraflores and Puerto de la Torre. For example, to buy an average house of 100 meters in the eastern zone, you have to pay 251,800 euros and 144,900 euros in Bailén-Miraflores and Puerto de la Torre. They are separated by more than 100,000 euros and, although rents are more expensive in the east, profitability for the investor is higher in other neighbourhoods, at least in the short and medium term. Another thing is to own and rent an inherited home. In this case, the benefit is greater in areas where purchasing power is greater in the city, although they also tend to bear more tax and maintenance expenses.

The best returns

This report presents a curious fact: the buying effort, as such, includes the years of gross household income needed to buy a home. This type of statistics involves the number of years of payment of a house if all the money available in a house was dedicated, i.e. without having to buy food, clothes, etc. The largest buying effort is in the east, at 12.7 years, compared to 11.6 years for Ensanche-Centro, 9.8 years for the historic centre and 8.1 years for Churriana. The average in the capital is 7.7 years, but it is lower in Ciudad Jardon (4.9), Bailén-Miraflores and Puerto de la Torre (5.2), Carretera de Càdiz (5.8), Cruz de Humilladero. (5.8), Perchel-La Trinidad (6.4) and San Felipe Neri-La Merced (7.6).

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