Presented by Dynamic Lives
High Yields Make Ibiza a Great Rental Investment
Looking to invest? Think Ibiza. The white isle offers up to 10 percent rental yields according to the independent real estate agency Lucas Fox. “Ibiza is the hottest place in the world right now for the high-end rental market,” says Jason Ham, responsible for sales and business development. “The island has overtaken San Tropez as the hotspot for investors from all over the world,” he adds.
The company currently reports yields of 8 to 10 per cent across the five-month peak period. It expects the season to extend from April until late October as Ibiza evolves as a year-round destination. British Airways now operates directs flights six days per week from London City in the low season alone.
Ham explains the average age on the island is now late 30s and early 40s with former clubbers returning to invest in infrastructure: “Ibiza is really growing up as a luxury destination for non clubbing-related activity,” he says.
Economic Recovery
The Spanish property market overall is warming up as the local economy emerges from the global economic downturn with 3.2 per cent growth in 2015 according to official figures.
The recovery, fueled by GDP growth and a record drop in unemployment, is attracting international buyers to look again at Spain. The international real estate consultancy CBRE cites the Balearic Islands as a key region for growth in the property market alongside Barcelona and Valencia.
The consultancy’s Real Estate Sector Outlook 2016 reports low interest rates as fueling the recovery, making “alternative investments such as residential [property] more attractive to investors.”
Fluctuations in the currency market and questions over a possible Brexit following the June referendum in the UK are not causing concern at the local level. Local sources urge buyers to look beyond the sensationalist headlines at Ibiza’s long-term viability.
“Ibiza is a world renowned-brand. It has a micro-economy of its own,” says Ham
One-stop Shop
Luxury Ibiza villas company Dynamic Lives offers a selection of villas as investment properties, generating a private income for the villa owner while empty. The company acts as a one-stop shop to facilitate the buying process, take care of the day-to-day management and handle the marketing of the property for clients. For owners, that means dealing with one person instead of multiple agents.
“We are the ideal place to start for investors looking at the island,” explains George Burdon, Founder Director, Dynamic Lives.
“With a strong brand and 16 years of experience, our key strengths are our marketing reach and wealth of knowledge to manage properties on behalf of our clients.”
The extensive selection of luxury villas in Ibiza includes Villas Lotus, a seven-bedroom property perched on a hill near the beaches of Cala Bassa and Cala Conte.
New Regions
The smart money for future yields, suggests Ham at Lucas Fox, is based around opening up new parts of the island away from the nightlife hubs and place-to-be-seen beaches.
“Interest was focused around the southwest of the island but investors are now looking further north with Santa Gertrudis attracting real interest,” he says.
Spain attracted a new record of 68.1m foreign tourists in 2015 with the solid tourism sector representing 14 per cent of Spain’s GDP. Lucas Fox expects increasing arrivals and growth in Ibiza for the next five years.
“Ibiza is a small island, so the demand for property continues to outstrip supply,” adds Ham. “The prices are high — but so are the yields.”
