When it comes to investing, we have many options. We can invest in real estate, the stock market, shares, cryptos, etc. Despite the many options available, real estate remains one of the safest and most profitable investments, as we can achieve high returns mainly from buying, renovating, and selling in Barcelona.

Buying, renovating, and selling in Barcelona

A few days ago, we told you how to convert a commercial space into a home. This practice is particularly on the rise in Spain, as it allows for higher returns compared to other types of real estate opportunities. Therefore, more and more investors are considering it.

In any case, real estate investments are on the rise, and more investors are deciding to bet on them, following this trend of buying, renovating, and selling in Barcelona, because it is profitable. But how to do it? We’ll tell you everything you need to know.

Is it a good idea to buy to renovate and sell?

Nowadays, we find a wide offer of old apartments with no way out. This type of property is very attractive to investors, as it can be acquired at a lower price than one with the same characteristics but newer, because it needs renovation or is not ready to live in.

This type of housing that needs renovation to be occupied is interesting for those looking to live in rental properties or buy without having to do the renovation themselves. After all, not everyone has liquidity to face a renovation, and not all banks grant mortgage + renovation loans. Therefore, it is a good opportunity for investors to make it easy for users looking for something like this and earn a lot of money.

Thus, considering that there is very little supply of new housing, renovating and selling in Barcelona is a way to give a new life to old apartments that are not selling. Since they are not selling and there are many, their prices drop, and bargains can be found, which makes the returns higher.

How much can you earn from a renovation?

The truth is that there is no exact figure. It is estimated that generally, a comprehensive renovation can increase the price by 20 to 30%, but it depends on the property, as in some cases it could be double.

For example, in the case of a very old apartment that is not livable, it may deter future buyers, and no one may want it. However, with a comprehensive renovation, it would become completely new, with everything brand new, as if it were 0 years old. Therefore, the new seller could ask for much more money: what they paid for the renovation + profit.

How much to allocate for a renovation?

The ideal is to allocate the minimum to obtain the maximum possible return. In fact, it is also not recommended to invest more than 30% of the property’s value. Therefore, it is important to do the math and see if it is worth it.

To give you an idea, renovations are around 400 euros per square meter for medium quality. Although, as always, it depends on the location where the renovation is done, whether there is high demand, etc.

There are also investors who instead of a complete renovation opt for a facelift or a partial renovation. It is much cheaper and can be very profitable if bought and sold.

Do I need to have liquidity?

If you are an investor, you can negotiate with the bank to obtain a mortgage for your property and the renovation. In some cases, you might have to advance something, but you could even mortgage what you already have and negotiate a good interest rate, which you would quickly recover with the sale of the property. But always consider the payment of taxes, which varies according to the autonomous communities.

However, if you have cash, you will obtain a higher return by not having to face interest payments. It may even be that in some cases a personal loan is more beneficial than a mortgage (depending on the amount). Therefore, it is important that you always do the math.

Is it better to sell furnished or empty?

It depends on the profile you are targeting, but generally, it sells better empty. That is, it is common to see investors renovate the property and add a modern kitchen and completely renovated bathrooms, but leave the other rooms of the property empty. This way, future buyers can move in and buy all the furniture from scratch, furnishing and decorating to their taste. This is ideal.

Can we help you with your real estate investments? Bet on bricks and achieve high returns by buying to renovate and then sell. Our real estate investors can help you. Shall we talk?