Vallecas Bridge and Nou Barris are crowned as the most profitable districts to buy a home and put it up for rent in Madrid and Barcelona, respectively. The first offers the owner a return of 7.58% and the second 5.76%, according to urbanData Analytics data corresponding to the second quarter of the year. In both cases far exceed the average of their respective capitals, although only the Madrid district is above the national average, located at 7.01%.
In Madrid, the gross rental yield it stood at 4.8% between April and June, but in some districts it exceeded 7%. This is the case of Puente de Vallecas, but also of Villaverde (7.56%).
According to the experts of the proptech Specializing in real estate advice, Puente de Vallecas has one of the lowest sale prices in the city, 1,813 euros per square meter on average; with a purchase effort of 4.3 years, also, one of the lowest among the districts. However the unit rental price was 11.4 euros per square meter.
“In addition to registering significant average yields, the area is characterized by high market dynamism: a high absorption and short sales times, lower than the average for the capital. However, to study investment for rental purposes, it is convenient to carry out a micro-analysis at the neighborhood level and by type of housing “, explains Raquel Gómez, Head of Valuations at urbanData Analytics.
The houses located in another nine Madrid districts also offer higher than average returns. They are Usera, Latina, Carabanchel, Villa de Vallecas, San Blas, Vicálvaro, Ciudad Lineal, Moratalaz and Tetuán.
On the contrary, the districts of Chamberí, Retiro, Chamartín and Salamanca do not reach 4% return. And why is there so much difference between zones? The districts located in the south have registered purchase prices much lower than the central areas. “The offer of small homes is much higher in Puente de Vallecas or Usera, allowing greater price negotiation, while the rental offer for one and two-bedroom typologies is higher in Chamartín and Retiro,” explains Gómez.
Barcelona
In Barcelona, the Nou Barris district has the highest gross rental profitability, 5.76%, above the city (4.76%). The average sale price is 2,435 euros per square meter, at the bottom of the rest of the districts of Barcelona, with an average rental price of 11.7 euros per square meter, very close to other areas such as Sant Andreu or Horta Guinardó.
The homes that offer the highest profitability to the owner are those of 55 square meters
“The smallest buildings, apartments or one room are those that register the higher volume of transactions of the district “, explains the expert from urbanData Analytics. In addition, Nou Barris is also the district where the prices of the smallest houses have fallen the least.
Three other districts of Barcelona also offer returns above 5%. These are Sants- Montjuïc (5.20%), Horta – Guinardó (5.10%) and Sant Martí (5.09%). At the opposite extreme are Les Corts, which offers the lowest return in the second quarter of the year (3.6%), Sarrià – Sant Gervasi (3.83%) and Eixample (4.22%).
In global terms, the type of homes that offer the highest profitability to the owner are those of 55 square meters, since they have the highest rental prices and purchase values below the average. The experts also explain that the markets of Barcelona and Madrid are stable and have a high dynamism due to the rates of absorption and very low times of sale and rental.
Lower profitability
Gross rental profitability in Spain fell by 8.3% in the second quarter of the year compared to the previous three months, to stand at 7.01%. The fall is explained by the general decline in rental prices after the pandemic, while purchase prices have resumed the positive trend.
Lleida is the capital that offers the highest return to the owner (7.93%), followed by Huelva (7.54%) and Murcia (7.47%). On the contrary, the capitals that offer a lower return to the owners are San Sebastián (3.37%), Palma (4.40%) and A Coruña (4.70%).
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