PALMA, Spain, Aug. 24, 2023 /PRNewswire/ — Lionsgate Capital, Spain’s premier Mortgage Broker firm, is spotlighting the advantages and lucrative potential of property investments in Spain for English citizens, be they residents or expatriates.
1. Economic Landscape: The financial disparity between Spanish and UK mortgages is noteworthy and advantageous for potential investors. In Spain, the prevailing interest rate for a 20-year fixed-term mortgage averages at 3.5 %. In stark contrast, the UK’s rate stands at 5.55%. This differential implies that for a mortgage of identical value, a borrower in Spain would pay approximately 2% less interest rate per year than their British counterpart. Several factors contribute to this disparity:
- Inflation Rates: The UK has with a higher inflation rate than Spain, leading to elevated interest rates.
- Unemployment Metrics: A higher unemployment rate in the UK makes borrowers riskier in the eyes of banks.
- Regulatory Environment: The UK’s stringent banking regulations necessitate higher interest rates.
2. Amortization Dynamics: Spain’s generally lower property prices mean that Spanish borrowers often secure smaller loans. The typical amortization period in Spain is 25 years, five years longer than the UK’s average of 20 years. However, Spain offers even longer mortgage terms for residents, extending up to 30 years with certain lenders.
3. Luxury Property Market Overview: The Balearic Islands and Marbella’s luxury property markets have recently seen significant growth. In just the last five years, the value of upscale homes in these areas has increased by more than 50%, and this upward trend shows no signs of slowing down. This surge can be attributed to a variety of factors:
- Affluent Buyer Surge: The global millionaire population is burgeoning, with many eyeing luxury properties in these Spanish regions.
- Luxury Tourism Boom: An increasing global clientele is flocking to these regions, drawn by the beaches, climate, and lifestyle. Many tourists are becoming property buyers, eager for more permanent stays.
- Infrastructure Developments: Continuous improvements in roads, airports, and public services are enhancing the appeal of these regions for luxury buyers.
4. Investment Returns: Spanish luxury properties can generate an enticing gross return of 7%. This suggests that for an investment of 1.000.000 euros, investors can anticipate around 70,000 euros in annual rental income. Even when factoring in property management, maintenance, and acquisition costs, the net profitability of Spanish luxury properties remains compelling, outpacing many traditional investment avenues.
5. The Spanish Experience: Spain offers an unparalleled quality of life beyond the numbers. The nation is celebrated for its temperate climate, world-class gastronomy, rich cultural tapestry, and diverse landscapes, from sun-kissed beaches to historic urban centres and serene mountains.
6. Expert Guidance with Lionsgate Capital: Founded by the visionary American entrepreneur Drew Aaron and Juanita Casanas, who previously was a director of one of the largest banks in Spain. Lionsgate Capital is uniquely positioned to offer bespoke mortgage consultancy and brokerage. Their seasoned team, with deep roots in the banking sector, ensures that every client’s unique needs are met, maximizing investment returns, and securing optimal financial solutions.
In conclusion, as the Spanish property market continues its upward trajectory, Lionsgate Capital remains steadfast in its commitment to guiding its clients toward lucrative and informed investment decisions in this vibrant landscape. For those considering a property investment in Spain, we invite you to calculate your Spanish mortgage with its easy-to-use tool.
Please visit Lionsgate Capital’s web for a deeper dive and further insight.
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