Most people buying a property in Spain are looking for either a holiday home, or a permanent home, possibly for retirement. Fortunately buying property in Southern Spain is also a great investment with steadily rising values driven upwards by a constant demand from new arrivals. For serious investors who are not just looking for a home in the sun, the Costa del Sol has proved to be one of the most lucrative property investment markets in the world, particularly in the last 5 years. Many investors, private and professional, have made gains of between 30% -100% within 12 months on money invested. Buying new property anywhere, before or during construction, and then reselling it as it nears completion has nearly always been a good investment. There are always buyers who will pay more for a finished or nearly finished property than they would for a property 'off plan' or a green field site with a completion date 1-2 years away.

Firstly you can start the process by reserving a property with an initial payment of 20-30% and then while construction continues the resale value will increase.

By now most, if not all the new properties in the development will probably have been sold and at any time you can re-sell your option to buy at a profit.

Alternatively continue to make the necessary stage payments and sell even closer to the completion date for an even higher price. Selling the option to buy before completion realises a significant profit and return on your initial investment.

About Renting

This year the Costa del Sol has achieved the highest rental prices for holiday accommodation in the whole of Spain including the Balearics and the Canaries. In August the average monthly rental per sq metre was as high as €81.95, which means the owner of a 60 sq metre apartment could enjoy a rental of €4,917.

This is 67% more than the Costa Brava and 70% more than Almeria. But on the Costa del Sol the rental opportunity is not a summer only phenomenon. Unlike many holiday locations throughout the Mediterranean, the coast enjoys international and Spanish visitors all year round, with no sense of it 'shutting down' at the end of the summer. This is due to several reasons.

1) The cosmopolitan ambience of Marbella, the local microclimate, and the unmatched cultural and sporting facilities throughout the area continue to attract discerning visitors throughout the year. Most prefer the freedom of a private rental to the rigidity of the big hotels

2) Golf and all its related activities has become a multi-billion pound industry throughout the region with visitors to the 60 plus courses fuelling demand for private rental properties, particularly on or near the courses. 3) The ever-growing commercial infrastructure of the coast and the nearby city of Malaga is attracting Spanish and European middle management and young professionals who frequently require a medium to long-term rental quite often paid for by their employer. All the above implies that your rental property will rarely sit empty and should provide a substantial extra income as well as the option of using it for yourself and your family whenever you decide. If you're planning to buy property for rental purposes Passepartout Andaluz will recommend you to the specific areas and properties that attract the most rental enquiries and best income.

You may choose to handle the rentals yourself or leave it all to a property management company, which we would be happy to recommend.

Either way it's not unusual to enjoy a return on your investment of more than 8% even allowing for mortgage payments, un-let weeks, and your costs. And while you're enjoying the rental income, your property will quietly rise in value providing a great security for you and your family's future.

For an overview of costs and revenues click here