We analyse the profitability of housing in the Valencian Community, the most profitable community in terms of property sale and rental prices.
The brick is still the most profitable financial product. According to the study ‘The profitability of housing in Spain in 2023’ carried out by Fotocasa, the profitability of housing in Spain at the end of 2023 stood at 6.4%, just one tenth less than a year ago. This slight decrease is due to the increase that has occurred in the purchase price, a more pronounced rise even than that produced in the rental price.
Even so, these investment returns are practically double those offered by other products such as Treasury bills or large bank deposits.
But what returns can we find in the Valencian Community, and how much has the price of housing in this autonomous community risen or fallen?
I want to make my property profitable
What profitability can you opt for?
Achieve maximum profitability through sale or rental
what is the profitability in the Valencian Community?
The Valencian Community leads the ranking with an average profitability of 7.9% according to data from Fotocasa’s 2023 profitability report. Behind the Valencian Community we would have Murcia with a profitability of 7.4%, Cantabria with a profitability of 7.3% and Castilla y León with a profitability of 7%. On the opposite side we would have the Balearic Islands as the least profitable community to invest in housing with a profitability of 5.3%, La Rioja with a profitability of 5.9% and the Basque Country with a profitability of 6%.
Housing profitability by autonomous communities in 2023 – Fotocasa graph
In this way, the Valencian community is the most profitable community for buying and renting housing.
This is so because during 2023 the rental price in the Valencian community has risen more sharply than the purchase price. According to the data consulted in the Idealista Price Index, from December 2022 to December 2023 the purchase price in the Valencian community has risen by 11.27%, from 1,596 euros per m2 to 1,776 euros per m2, while the rental price has risen by 13.75%, from 8.8 euros per m2 in December 2022 to 10.01 euros per m2 in December 2023.
For more details on how the price of housing is evolving during 2023 you can download our report on the price of housing, a PDF with information on the housing market on the Costa Blanca.
Costa Blanca Price Report >>
Despite this, the rental profitability that we can obtain from a property will depend on many factors such as the price at which we have bought it, the need or not of financing, possible reforms or the rotation of tenants (the higher the rotation, the lower the profitability).
Profitability of buying and selling
In addition to the profitability of renting, we can also achieve very interesting returns by considering the purchase of a property for subsequent sale. This type of real estate operation normally involves reforming or refurbishing the property in order to obtain a higher sale price, although this does not always have to be the case. In the case of the Valencian Community, the natural increase in prices during the last 5 years due to the higher demand, has caused the profitability of the properties to grow considerably.
In our article‘Profitability on the Costa Blanca to buy and sell in 2023‘ we analysed the 5-year gross profitability that we found in the different municipalities of the Costa Blanca according to the evolution of the price of housing registered by Idealista during the last five years.
In this way, we can classify the municipalities in which Hispania Homes operates according to the profitability of the sale and purchase as follows:
Ranking of profitability on the Costa Blanca:
- Profitability in Benitachell: 46.96%
- Profitability in Benissa: 43,33%
- Profitability in Jávea38,76%
- Profitability in Calpe: 37,33%
- Profitability in Denia: 33.65% Profitability in Denia: 33.65
- Profitability in Altea: 32,69% Profitability inAltea: 32,69
- Profitability in Moraira: 29.41% Profitability inMoraira: 29.41
- Profitability in Benidorm: 17.29% Profitability inBenidorm: 17.29% Profitability inBenidorm: 17.29
The quality of life, the climate and the local infrastructure are factors that make the Valencian community an attractive destination for property investment. In addition, the interest of foreign investors, especially in high-end properties, means that this region is always one of the most sought after.
If you have a property on the Costa Blanca and you want to evaluate the possibilities of making it profitable, you can consult our real estate agency. We will analyse the available options (sale and rental) so that you can opt for the maximum benefit.
