has meant that the Spanish government and developers themselves are keen to attract overseas buyers to the country. It also appears that bad news for the Spanish property market is good news for the savvy investor. The time may be right for those interested in investing in a property for rent on the Mediterranean coast to make some serious enquiries. In keeping with this edition’s theme of lifestyle and added value, PropertyLife would like to take potential investors on a lightening tour of Spain’s top festivals. By understanding the nature of these joyful celebrations of life on the Iberian Peninsula, prospective investors may be tempted to supplement their usual decision making process which is firmly rooted in the ‘it’s got sea and there’s sand’ school of decision making, and take a closer look at some of the more cultural attractions of this attractive investment destination. Of course, we’ll also be taking a look at the facts around rental yields and capital gains as well as tourist hot spots and cost of apartments in the latter part of this article. In the meantime, senoritas y senoritos, pack that abanico (fan), panuelo (shawl) and chaleco (vest) as we head for one of Europe’s most popular playgrounds; Spain and the Iberian Peninsula, home to fiery Spanish culture, and rich culinary traditions. Vámonos Amigos (‘let us continue friends’).
© FROM TOP: TAMORLAN / WIKIMEDIA COMMONS; AVXLYZ / FLICKR
Viva, Espana! The Spanish conquest of the new world and their colonization of South America has left its mark on cultures across the world. There are currently 500 million of Spanish first language speakers in countries ranging from Brazil and Paraguay up to the doorstep of North America in Mexico, making it the third most-spoken language after Cantonese and English. Spain is no longer the global political or military power that it once was. Buffeted by the global economic crisis and a rocked by a property market which took a battering (from which it is still recovering) in 2007 and 2008, it has somehow managed to retain its position as the 13th largest global economy. However, 2008 brought the property market to its knees and an economy which had been characterised by a frenzy of infrastructural and property development suddenly found itself faced with an industry that was bloated by enormous over-supply and rampant inefficiencies.
PASSION, PROPERTY AND PAELLA The cuisine of Spain is widely renowned for its unique and complex pairings of seafood and local produce sourced from inland regions. For some investors, Spain is a mouth watering prospect for reasons other than its food.
In 2008, Spain’s property bubble burst, leading to the collapse of the large property-related and construction sectors, resulting in mass layoffs that caused the bottom to drop out of the property market, a situation exacerbated by the country’s unemployment rate hitting a record-high 27.16% in April 2013, while joblessness among young Spaniards (below 25 years old) reached an alarming rate of 55.7%. While these twin events may give prospective property investors pause and lead to questions regarding the risk profile of Spain, the truth of the matter is that the country is not a particularly high-risk investment destination (inasmuch as this can be said in a highly fluid global investment environment). It’s worth pointing out that despite the domestic economic slowdown (meltdown?) the country has experienced over the past 5 years, the tourists never stopped coming. Spain’s festivals continue to draw in tourists from all over the world. And it is these tourists who are the target market of buy-to-let properties in Spain. The added incentive for investors is that due to the weak economy and bearish property markets, now is the best time to purchase property in Spain. Prices are low, inventory is high and demand is weak.
Despite the country’s economic struggles, Spanish citizens across the country continue to celebrate life. The festivals must go on, no matter if jobs are hard to find, wallets and bank accounts are almost empty and economic indicators paint a bleak picture of the future. The fun-loving Spaniards will continue to revel in fun and joy, gyrating to the music of the Tango and feasting on paella as they observe the following key festivals of Spain.
FIESTA GALORE January – Tamborrada de San Sebastian (The San Sebastian Drum Festival) Groups of drummers parade throughout San Sebastian, Basque Country, on Jan. 1. It is followed by the Tamborrada Infantil (Child Drummer’s Ceremony) on Jan. 2.
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