The national statistical authority recently published figures that shed light on the rental market in Spain. Rents have risen by 50% since 2013. The largest price increases have been in Palma, Barcelona and Malaga. In the Costa del Sol, short-term rentals against tourists have also increased significantly, and still do not seem to have reached their peak. In the first 7 months of this year, tourism in Malaga increased by 5.9% compared to the previous year. Even in these statistics, they go hand in hand, Malaga is at the top along with Barcelona and Palma. In the latter two areas, however, restrictions on renting out to tourists and sharp price increases have significantly dampened the willingness to invest.
Later in this article we will present some new developments, but mainly one, Hexagon, which benefits from lower prices per square meter than its competitors, as well as an elevated position with sea views for all apartments. The rental potential in this exclusive area, Limonar, is huge. According to statistics from Spainhouses.net, the average cost of a rental is 1800 € per month in Limonar (note that these statistics also include smaller and old apartments, without a view). This can be compared to lucrative Nerja, which attracts many investors when the occupancy rate is higher there than, for example, in the Marbella area. Despite this, the average cost per month for rent is “only” 833 € in Nerja according to Spainhouses.net. NOTE! The figures are based on long-term rentals. Vacation rentals have significantly higher numbers.
Which areas are have most demand in Malaga then? The historic neighborhoods, city center, and Malagueta / Limonar. We do not have any new apartments for rent in Limonar, but to bring in newly produced apartments in this exclusive part of the city is a bit like getting hold of the holy grail for rental companies. Many investors also feel great security in the fact that there is a strong demand for long-term rental from newly-relocated companies, lawyers, doctors, etc. These are also prepared to pay extra for the situation as well as newly produced.
According to the construction consultant’s analysis, the value increase in Limonar is expected to be approx. 7-8% per year over the next few years. Also note that off-plan projects, in growth areas (which, for example, was the case in Nerja on projects sold in 2016-2018), tend to increase in value by 25-30% during the construction process until moving in. In addition, Hexagon is about 20-25% cheaper than the corresponding apartments under construction / sales in the area.