Investment on Gran Canaria

You may also be one of the people who are currently worried about the security of the savings deposits in your bank account. But don't be afraid, because you are certainly not alone.
From various conversations with customers, acquaintances and also friends, the same patterns, questions and worries emerge again and again. People start talking in the subjunctive "what if". Well, at the end of the day, nobody knows where the journey of the capital and financial markets will lead. When I look at the current situation and the negative interest rates on savings deposits, inflation, extreme new national debt, etc., it makes me a little queasy. The low interest rate policy of the European Central Bank (ECB), which has been going on for a long time and is unlikely to end any time soon, is causing people to look for alternatives when it comes to investing their money. For me, this is a logical consequence, because the money in the account is in fact worth less and less. Some people invest their hard-earned assets in cryptocurrencies, precious metals or shares, others in luxury goods, land and real estate. Cryptocurrencies in particular are not really tangible for me, without me demonising them. It may one day be the means of payment of the future, but I for one am still too far away and remain sceptical. My favourite topic in this context is of course real estate in Gran Canaria, because this is my personal business and I claim to know it quite well.

What are the most common types of property investment in Gran Canaria?

•     You buy one or more properties and then rent them out.
   
•     "Fix & Flip - You buy one or more properties, renovate them and sell them again.  
   
•     You buy a property, build and rent or sell.
   
•     For example, you buy a pub, hotel or other property and achieve a licence change and sell or let, whether tourist or residential.

If you have read the previous points, you may have noticed that they are likely to deliver varying degrees of risk & profit margins. Especially with "fix & flip" you need a certain amount of experience and a good and lucky hand when buying property as well as the property sale which usually takes place within 6 - 12 months. In addition, reliable construction companies are needed to carry out the necessary modernisation work in a professional manner.

A classic investment is the purchase of real estate with subsequent letting. Our clients do this time and again, and we help them not only with advice and the purchase process, but also with the subsequent rental. There are owners who would like to rent out their flat, bungalow or house to tourists, e.g. on a weekly basis, but there are also many landlords who offer their property for wintering or for residential purposes on Gran Canaria. When renting out for tourism, it is important to make sure that you have the appropriate licence ("Vv" for vivienda vacacional). However, it is not uncommon to rent out a property without a valid rental licence. According to the motto: "Where there's no plaintiff, there's no judge". This can work under certain circumstances, but it can also lead to questions from the authorities.

If you would like to start your investment in Gran Canaria with a new building, this would also be possible. In the past few years, relatively few new buildings have been built, so that mostly existing properties have changed hands. In the meantime, more new construction projects are being seen here, and a new development is currently being built in El Tablero (next to the shopping centre "CC El Tablero"). Modern terraced houses are being developed here, some with a view of the mountains, others rather with quite a lot of noise from the GC 1 motorway. But nothing is as different as the taste or the desired requirements of a property, I experience interesting situations and ideas from prospective buyers almost every day.

Now, unfortunately, it is not always easy to find a suitable plot at an adequate price/performance ratio. Because, as in many places of interest, prices are continually rising.
Many questions will come up when you are planning a new building project. For example, do you buy from the plan or a finished house? Are there reliable building companies and architects who guarantee a flawless execution from the planning - through the execution - to the completion? What about the "developer's guarantee"? Would you like to build a multi-family house, your own home, a bungalow or possibly a wooden house? How quickly can you get a building permit and what are the conditions? Are there subsidies for energy-saving properties or even special requirements for implementation? What about construction financing abroad, especially here in Gran Canaria?

Questions upon questions about new construction. That's why I'm motivated to write a separate blog entry on this matter when the opportunity arises. Because new construction projects are always in demand. However, due to the complexity, most people prefer existing properties in locations close to the beach. The areas in the south of the island, around Maspalomas, Playa del Inglés, San Agustín, Meloneras, Sonnenland and San Fernando, are the most in demand, although one or two customers also look towards Puerto Rico, Puerto de Mogán or Arguineguin. Foreign buyers are less often drawn to the interior or the north of the island, as the weather is more pleasant and stable in the south. But that shouldn't stop you from going on great day trips. As you probably know, Gran Canaria offers a lot of scenic, urban, cultural and culinary variety.

Now, there is also a property market and rental opportunities that focus on rural tourism. This does not necessarily appeal to the majority, but to a number of people who want to spend their holidays or their lives secluded and surrounded by beautiful nature. Thus, the purchase of a finca on Gran Canaria can also be an interesting investment. Families with children, people in well-deserved retirement, artists, celebrities, home office workers etc. could become your future long-term tenants or holidaymakers in this sector. Should you wish to focus on tourist rentals, there are a few things to consider here as well. I have already touched on the subject of official rental licences, I will also report on this in more detail in a new blog entry and give you tips along the way.

I would like to give you some more information & tips on today's topic "Investment on Gran Canaria":

•     Buy at a good price and try to negotiate.
   
•     Compare financing offers, interest rates are low.
   
•     Buy in popular and lucrative locations.
   
•     Do not let yourself be pressured.
   
•     Comprehensive advice is important.
   
•     Take your time to look at everything.

You may wish to sell your property in Gran Canaria and would like professional assistance in the purchase process. We would be pleased to accompany you on this path - up to the notary appointment and beyond.

I wish all readers a wonderful Whitsun weekend, I am now looking forward to a nice tour of the island by motorbike followed by a swim stop at Playa de Amadores.

Stay safe and sound and see you soon, sunny greetings at 27 degrees from Gran Canaria,
Kai Derichs