More and more young people are considering moving to Spain – living a digital nomadic life and enjoying a lifestyle.
With data suggesting that there has been a large rise in the number of young people considering a move to Spain – to live the digital nomad life that has become far more attainable since Covid and the rapid rise in remote working – how can property investors take advantage of an increased demand for rental or sales homes?
In this Q&A, Property Investor Today spoke with Martin Dell, founder of Kyero.com, a leading online European property platform for UK buyers, to get his thoughts on the potential opportunities for overseas investors in Spain. As well as looking at why many young people themselves are now seeking to invest in a home abroad.
You have new data showing a huge growth in young people from the UK considering a move to Spain – can you tell us more about this and how investors could benefit?
We’re seeing a new, younger generation of people embracing a move to Spain – in 2020 there was a 446% increase in 18-24 year-olds viewing Spanish property on Kyero.com, so it suggests there’s a growing momentum among this demographic.
We’ve christened this group ‘corona-nomads’ – with no office job, mortgage or family responsibilities to tie them down, they can now live and work where they really want to be. And many of them are choosing Spain – so there is a real opportunity for investors to cater to this new, growing trend.
You say Covid is having an impact on the Spanish property market by changing the types of locations most popular among overseas buyers – what were your findings?
Coronavirus and higher levels of remote working are driving up interest in property overseas as the dream of moving to Europe becomes a realistic possibility, and January 2021 was a record month for the platform as more people than ever before searched for overseas property.
The pandemic has also changed the types of locations becoming popular with overseas buyers. Because of the surge in remote working, people can base themselves abroad for longer periods these days, negating the need to be 30 minutes from an airport and making more remote and often cheaper areas of Spain increasingly viable – and therefore popular – options.
This is opening up new ‘off-the-beaten-path’ destinations for investors and corona-nomads alike.
What are some of the most up-and-coming Spanish locations they are considering?
Now that trips abroad aren’t so restricted by holiday allowances and 9-5s [outside of the current Covid restrictions on travel], we’ve identified a number of up-and-coming locations that we envisage could increase in popularity:
The traditional town of Alcaudete in the Andalucia region has seen a six-fold increase in property enquiries over the last year. Located around two hours inland from the tourist hotspots on the south coast, historic features, affordable property and a friendly small-town atmosphere make it an appealing option.
Two hours’ drive from both Barcelona and Valencia, property in Deltebre saw a 135% increase in property enquiries in 2020 on Kyero.com. Positioned on the Balearic coast, it has good transport links, but is nicely off the beaten path.
Jerez De La Frontera, Cadiz
A laid-back city famous for its sherry bodegas and incredible tapas bars (which double as great sociable spots to work from), Jerez De La Frontera is situated 30 minutes from the historic port of Cadiz and the Costa de la Luz. It’s one of the hottest spots in Europe with 3,000 hours of sunshine per year and property in the area saw a 70% increase in enquiries in 2020.
What are digital nomads/young British tenants looking for in homes in Spain, so investors know what to include?
Many younger expats will be seeking well-decorated, modern properties that they can quickly and easily move into. Investors should consider properties that offer multi-purpose living/work space, as well as good internet access.
Locations with a strong community of other digital nomads, and facilities like co-working spaces, will also appeal to this new market, and these elements should be highlighted. There are opportunities for both sales and rental properties.
Hasn’t Brexit complicated the whole process, as it’s now far more complicated for Brits to stay in an EU country for longer than 90 days?
International sales in Spain have grown every year in the three years following Brexit. Whilst we’ve seen increased interest in Spanish properties from younger people of all nationalities over the last year (up 111% in 2020 compared to 2019), it was British interest that really skyrocketed (up 446%), suggesting that Brexit is a key continuing driver.
Many young people don’t want to lose their freedom of movement across Europe, and by becoming permanent Spanish residents, they can regain their pre-Brexit rights as EU citizens.
Brexit does mean stricter eligibility requirements and more red tape when it comes to buying in Europe. However, Brits will essentially face the same entry requirements that all other non-EU buyers (who make up a significant population) have when buying in Europe post-Brexit.
Isn’t it now also more difficult for overseas buyers in Spain because of Covid and Brexit? Surely there aren’t many buyers who will purchase sight unseen, which seems the only option at the moment during the second wave of the pandemic?
It is really important that buyers follow the appropriate lockdown and travel restrictions wherever they are. For expat buyers already based in Spain, often it’s possible to view properties in line with local restrictions.
But, certainly, we are also seeing a significant increase in online viewings, and more thorough prior research, which results in increased viewings and purchases, when lockdown restrictions allow. For example, in the first lockdown (April-June 2020), we saw a 30% increase in UK visitors to the site compared to the same period in 2019.
Should young UK first-time buyers consider Spain as an alternative? Are house prices more affordable and how easy is the system to navigate compared to the UK?
Spain already has more affordable property prices compared to the UK in many areas so it can be a good option for first-time buyers. Property in some of the more remote locations, as well as up-and-coming areas, can be even more affordable so we’re expecting younger first-time buyers to increasingly see a Spanish move as a sensible option.
The system of buying property in Spain can be complicated and is different to the UK. For example, in Spain, estate agent commission can range from 5-12% compared to just 1-2% in the UK, and there is no formal qualification or registration needed to sell a property in Spain. So it’s essential to get good advice.
One of the reasons we set up Kyero.com was that we learnt this from bitter experience after buying our own property in Spain. We were convinced that there had to be a better way, and wanted to help support other buyers through the process. Our recommendation is to do your research and if you can, find an English-speaking estate agent to help.
Source: Property Investor Today