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If you have an empty property, you probably already know that this is not one of the best decisions you can make for your finances. An unoccupied house only generates expenses and, in addition, there is always the risk that it will be occupied by squatters.
The most viable alternative for making a profit from a property that you do not want to sell is to rent it out. Even now, in the midst of the pandemic, there is still a high demand for rentals, especially in large cities and coastal areas.
The data we obtained last year is a good illustration of the interest in renting in Spain. In 2020, a date that will go down in history as one of the most difficult years for mankind, at Engel & Völkers Spain we managed to rent out 42% of the properties we advertised.
Although the property does not have a mortgage, it does have many expenses. For example, if utilities such as water and electricity are still connected, a minimum monthly payment has to be made.
In addition, you have to pay taxes such as IBI or the rubbish tax, which are usually quite high. On top of this, there are other associated costs such as Service charges, home insurance or the alarm system to prevent intruders from entering.
At the end of the year, this means a cost of several thousand euros for a home that is either empty all year round or that is hardly used.
However, the situation changes completely if the property is put on the rental market. By obtaining a monthly rent for the property, all those expenses associated with ownership are fully covered. In addition, many of these expenses can be deducted in the tax return:
The home is kept in better condition
Houses that remain unoccupied for a long time tend to degrade more quickly due to factors such as moisture accumulation and lack of ventilation.
Again, this can be avoided by renting it out. The presence of tenants gives a new "life" to the house, which keeps it in better condition, as it is subject to regular maintenance.
Renting out the property makes the investment profitable
Buying a property means making a significant outlay. Even in those cases in which it has not been acquired with an investment in mind, it is worth analysing the situation in terms of profitability when the house is not being used.
As we have been pointing out, an empty house can be a source of many problems. On the other hand, if you choose to rent out your home, you will obtain extra money every month that you can use to pay the mortgage instalments (if the house has a mortgage), or to invest it and increase your savings even more.
The house is still yours
Having an unoccupied house does not mean that this situation will continue over time. Perhaps the owner has had to move to another city and has left what was his or her habitual residence, but will return in a few years. Or the property may have been purchased with a view to the future so that they can live in it after retirement.
The good thing about renting is that the owner has the security of knowing that his or her home is still there. You do not have to sell it if you plan to use it in the future, even if it is in the distant future.
How to rent out a property without problems?
As an owner of an empty property, you may be aware of the disadvantages of having an empty property and the advantages of having a tenant. But you may also be a little afraid of letting your property to a third party.
At Engel & Völkers Spain we know that the key to renting a property without it being a problem for you is to leave everything in the hands of professionals such as those who make up our team. In fact, more and more homeowners are deciding to entrust all the rental management to our experts to avoid any worries. In this way, the only thing the owner of the property has to do is enjoy the monthly rent they receive for their home.
The key is knowing how to find the right tenant. A solvent person who offers payment guarantees and who will also take care of the house as if it were their own.
We work under the criteria of competence, exclusivity and passion, and this allows us to find the most suitable tenants, even internationally, and always with an exclusive service for both owners and potential tenants.
With a good tenant and a rental contract drawn up by specialists, there is no reason why the deal should not be a success.
The special case of holiday lettings
Holiday rentals, which involve renting a property for very short periods of time (a month in summer, a few weeks, weekends, etc.) have been the real estate phenomenon of recent years. But the arrival of the crisis associated with the coronavirus has significantly affected its profitability.
In a market that demands more and more rental properties, especially if they are of high quality, opting to rent out the empty property you have is one of the best decisions you can make. It is even more so if you choose to look for long-term tenants who can guarantee a sustained return over time.