In general we can say that the expected yield
on a rental in Barcelona can range from 1% to 10% per year.
What makes the difference between one and the
other, is that the more central, bigger and the more beautiful the house you
buy, the lower yield you’ll get.
If you buy on Paseo de Gracia you will get a
very low return, but nevertheless it is an asset that will increase its price
very quickly, it will lose little value even in the middle of hash crisis. Also
it’s very probably that your tenants will be of high quality and long-lasting,
and when a tenant leaves, you will have no problem finding a new one. On the
other hand you can get a yield of barely a 2% or 3%.
However, if we buy a property in the outskirts
of Barcelona, in nearby cities such as Hospitalet de Llobregat, Santa Coloma de
Gramanet, Sant Adrià del Besós, Badalona… the price of the property will be
cheaper, and the rent you’ll get for it will be higher in proportion to the
cost of the property.
For example, you can buy a property for as
little as 80,000 euros and then you can rent it out for 600 euros a month,
which is a gross yield of 9%. But of course, the quality and solvency of the
tenant will be lower, and the asset will be of poorer quality, and therefore it
is to be expected that it will increase less in value over time.
Anyway, it doesn’t mean that it can not be a
very investment, because the risk of insolvency can be easily solved with an
insurance of non-payment, by which, if the tenant stops paying you, the
insurance will continue paying you up to a year’s rent and the legal expenses
Another good thing of buying a property in a
city next to Barcelona, is that you’ll never have to worry to find new tenants,
because these cities are amongst the most densely populated cities in the whole
world, and the difference between Barcelona and these other cities is just
crossing a street
An important point for investors is that if you
are planning to buy a property in Barcelona as an investment, is that agencies
in Barcelona are reliable. They can take care of everything and they will only
charge you around 4% of the rent, so you won’t need to be physically in Barcelona
to manage the property.
If you have any doubt, please feel free to
write a comment on this video or send me an email.