Tuesday, May 6, 2008

Two Spanish villas worth same as a flat in London

The average capital value of rented houses in London has risen by 10.7% in 2008. This includes 12.4% in central London and 15.5% in the rest of the South East. The recent figures from A Place in the Sun suggest that the average price of a flat in London is worth the same as two Spanish villas.

A characteristic London apartment costs approximately £304,000. This means Londoners have to think about moving abroad to get more for their investment because for the same investment they can get two homes in Spain. For instance, two-bathroom, a three-bedroom villa on the Costa Blanca is priced £146,000 and a one-bedroom apartment in Almeria, costs an average of £163,000.

Even though the cash value of rents received by investors has kept pace with inflation in London, recent study by VillasforTravel suggested owners of tourist accommodation in Spain has collected the highest rental returns in Europe last year. Spain has the most potentially lucrative markets for investors who plan to purchase a rental property. Spain as a "lifestyle destination", rather than a place where people wanted to make a fortune.

Official government figures have revealed that the overall number of holidaymakers in Spain went up by 1.7 per cent to more than 59 million last year. Moreover Spanish government has been encouraging the buy-to-let industry by introducing a number of new financial incentive schemes.