So great is the demand for rental accommodation that the Spanish government is offering financial incentives to developers if they intend to redevelop apartments for this purpose; and to help young people fulfil their housing needs, the government is also subsidising them to the amount of €210 per month to help with rent payments.
As developers look to cater for this sudden surge in demand for well located rental properties, a rare opportunity has surfaced for investors to purchase off-plan property below market value in locations not previously considered Spanish property hot spots.
One such town in need of increased rental accommodation is Lorca, where the Universidad de Murcia, one of Spain’s largest universities with some 34,000 students, 1700 professors and 800 support staff, is due to open its fifth campus in 2009. The opening of the new campus and the steady stream of revenue expected by the influx of students and professionals is sure to be a good thing for Lorca.
Mike Hamilton, Sales Director at Casas de Lorca, recently described the current situation in towns like Lorca: “All of the properties available are rented long-term within a month. Most actually only take a week before a tenancy is agreed. We are witnessing the birth of a new local rental market which is increasing exponentially as more and more young Spaniards cannot afford to buy. The domestic buy to let market outside the holiday home market is virtually unheard of in Spain but the increases in interest rates and property prices have suddenly unlocked an investment opportunity.”
Lorca is already a popular destination with English investors, without suffering from the overdevelopment of some resorts on the Costa del Sol or Costa Blanca. Lorca is only 20 minutes from the beach, and is well placed for local golf courses, shopping and municipal districts. Plans to develop more golf courses in the area are likely to increase the popularity of Lorca as a golfing destination and help drive property prices up further.
Currently property is excellent value; take for the example the Las Flores apartments in Lorca which will be completed in time for the opening of the university and are a three minute walk from the campus. With a desperate need for more student accommodation, these apartments are sure to give investors a healthy return. With one bedroom apartments starting at 78,000 euros, two bedroom apartments from just 135,000 euros and 3 bedrooms starting at 147,000 euros, and guaranteed rental for 3 years, its easy to see why canny investors are going back to school for successful Spanish property investment.
For more information on these and other properties within Lorca please visit: http://www.casasdelorca.net/
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