Buying a condo in Spain

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FRx
Posts: 192
Joined: Tue Sep 02, 2014 3:29 pm
Location: Portland Or

Buying a condo in Spain

Post by FRx » Mon Jul 08, 2019 10:32 am

Wanted to get a sanity check on my thoughts in regards to buying a condo in Spain. It's €90,000 for a 400 sqft 1-br in a little city called Santiago de Compostela in the Galicia region (north). It's in a good area. Equivalent rent for a place like that would probably be €350/month. To buy this condo here in Spain I would have to cash out about $120k of my taxable investments to cover taxes and transfer fees.

I'm retired. 41 yo. I earn some money from my own website and some consulting work I do. I own another condo in the US worth about $170k which I have sitting empty because I don't need the income but have rented it out either on AirBnb or to friends from time to time. I have another $800k in investments.

A part of me thinks it's better to buy so that I have a fixed housing cost and another part of me thinks that renting makes more sense. I see myself living here for the near future but I'm open to living back in the US if I choose to. Got no family so it's just me.

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Lemur
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Re: Buying a condo in Spain

Post by Lemur » Mon Jul 08, 2019 11:02 am

Renting makes more sense IMO....after renting 1 year I'm sure you will have a better idea if this is somewhere you would want to live long-term. At that point, I think the buying option can be reconsidered.

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unemployable
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Joined: Mon Jan 08, 2018 11:36 am

Re: Buying a condo in Spain

Post by unemployable » Mon Jul 08, 2019 12:32 pm

So a cap rate of 4.7% on the Spain condo, and that's not counting expenses? I would absolutely rent that for up to twice the rent. Or looked at another way, in the US I can find much larger places in the US that sell for considerably less, but that's about as cheap as rents get (~$400) for your own place anywhere in the country.

With $800k in the bank plus real estate, the rent on a $400 place getting away from you is the least of your concerns.
FRx wrote:
Mon Jul 08, 2019 10:32 am
A part of me thinks it's better to buy so that I have a fixed housing cost
You already have a fixed housing cost! You're just not using it.

wolf
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Location: Germany

Re: Buying a condo in Spain

Post by wolf » Mon Jul 08, 2019 11:16 pm

I would first rent some place for 3 to 24 months before I would consider to buy something.

FRx
Posts: 192
Joined: Tue Sep 02, 2014 3:29 pm
Location: Portland Or

Re: Buying a condo in Spain

Post by FRx » Tue Jul 09, 2019 5:43 am

Thanks for the replies. I get your math @unemployable. As for the timing, I've been in Spain for 9 months now in total - it's just that I've had to go back to the US for some unexpected stuff in-between. I guess I'm a bit uneasy with purchasing a place this early as well which is why I posted.

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