Rental Investment - Apartment or Villa?

Hi

I'm new to this forum and hoping that there might be some residents in the Javea, Moraira, Denia etc region who might be able to advise me. My husband and I are Brits but have been living in New Zealand for the last 16 years. Much as we love it here, we have decided that we would like to relocate to the Northern Costa Blanca when we retire in 3-4 years. We are planning a trip to Javea in June 2014 to get to know the area and the plan is to buy a property whilst we are there which we could rent out until we relocate permanently. 

My question is, would it be better to buy a villa which would be our permanent home and rent it out, or would it be better to buy an apartment initially, rent it out and then buy our permanent home when we relocate in 3-4 years time?

I'm concerned that there a glut of rental properties in the area, meaning that there is a lot of competition in the rental market for home owners? Likewise, is there a glut of properties for sale, which might make it difficult for us to sell when the time comes (based on what's happening in the current property market, since I doubt there is anyone out there with a crystal ball)?

And, one final question, what percentage under the asking price,roughly speaking, do properties tend to sell for. This will determine the price range of the properties we would be looking at.

Hope someone out there can help.

 Spam post or abuse? Please let us know

Hi , we spend 3-4 months a year in the areas you are looking so are not residents but have a reasonable knowledge of these places, here's how I would see it,

My question is, would it be better to buy a villa which would be our permanent home and rent it out, or would it be better to buy an apartment initially, rent it out and then buy our permanent home when we relocate in 3-4 years time?------ the fee's associated with property transactions in Spain and given the market conditions I would try to advoid the buying and selling process as much as possible, properties probably won't be climbing in value so it will be costing you money (14%) or so and maybe more if the value of the accept depreciates, so for me you would be better of with the property you want to live in

I'm concerned that there a glut of rental properties in the area, meaning that there is a lot of competition in the rental market for home owners? Likewise, is there a glut of properties for sale, which might make it difficult for us to sell when the time comes (based on what's happening in the current property market, since I doubt there is anyone out there with a crystal ball)?------- properties that are priced correctly seam to sell but there is lots around, most is over priced in the current market so will stick around for years, there are a lot more apartments than villas and Denia and Javea have much more of these than Moraira, there is a very good market for summer rentals but if you are looking for all year round letting there is ample supply so out season prices are much lower, as to a percentage off asking price it will depend on how realistically it is priced, if it is priced for market conditions it will sell at very near asking price as wont be around for long

 Spam post or abuse? Please let us know

Hi Longlegpete, thanks very much for the constructive comments. I have definitely taken them on board. It's interesting that you say " properties probably won't be climbing in value" as another option for us would be to wait until we actually relocate permanently before buying anything. I'm just concerned that the Spanish property market might escalate over the next 3-4 years and price us out of the kind of home we'd like.

Another member has sent me a PM and informed me that Spanish law, as it relates to renting out property, is an absolute minefield and even the experts (solicitors, real estate agents, 'successful authors' of guides to buying property in Spain, etc) get it wrong, with the result that most homeowners are renting out illegally (also that it involves so much expense that it's not worth the effort). I'd be interested to hear your view of the situation.

By the way, hope you don't mind me asking, do you own a property there or do you simply rent each year. Also, what's the social life like there for 'young' retirees (young at heart that is)?

 Spam post or abuse? Please let us know

Hi Kiwilass

                  I will send you a pm
 

 Spam post or abuse? Please let us know