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Lanzarote Villas - Buying for Investment |
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Submitted by Janeane Carnagie
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Many people are buying property in Lanzarote purely as an investment, intending to rent out the property for as many weeks in the year as possible and also see good capital appreciation, as opposed to putting their money into pension schemes which have been performing very poorly. So how do you decide where and what properties are likely to give you the best return?
Lanzarote´s climate is such that year-round rentals can be achieved as winter temperatures average around 20/22C daytime average maximum, making it the warmest part of Europe in the winter. But this has an affect on property prices, making them quite high in comparison to resort areas in some other countries. However, the large number of new properties being built on the island, especially in Playa Blanca, is helping to stabilise prices.
So firstly of course, you have to decide on your budget. As in any resort area, the further away from the coast you buy, the more you´ll get for your money. However, the further away from the coast the property is, the harder it is to rent it out. Lanzarote has the advantage of being quite a small island so no matter where you are, you are never more than 20/25 mins drive to the coast. Realistically though, to achieve a high number of weeks rental, you need to buy in one of the 3 main resorts – Puerto del Carmen, Costa Teguise and Playa Blanca. Your budget will determine whether you can afford an apartment or a villa. Which ever one it is, a swimming pool is essential – in the case of a villa, a private one which is heated. So, your main criteria are ideally to be as centrally located as possible close to cafes, restaurants, bars and supermarkets so that holidaymakers don´t have to hire a car if they don´t want to, to be close to the beach, and to have a pool. If your budget is quite high though, there is a big market for those people who hire a car and want to stay in a quiet peaceful area a bit away from the resort centre. When you go to look at a property, take a few photographs of the outside and inside and have a look at them before you decide on a purchase. The photographs are what sell the property. If the property doesn´t take a good photograph, it is unlikely to do well for rental. To determine what rental income you are likely to achieve, have a look at similar properties in the area on rental listing sites and see what they are charging. If these sites have availability charts, this can give you some guide as to their success in attracting rentals.
Buy a villa in the right location, present it and market it correctly, and you can realistically achieve 30 to 40 weeks occupancy in your first year. Along with the capital appreciation, not a bad investment!
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