Renting a house in the province of Alicante is already more profitable than in 2019before the pandemic broke out. This comes from a study conducted by valuation and valuation company Euroval and the Real Estate Analysis Institute (Instai), which concluded that the average return in 2022 is 6.1%, half a point higher than the previous year and a tenth higher than the previous year. four years ago. Profit growth was possible after a 15% increase in rental prices last year, but the rise in the cost of buying a home weighed on the results.
The profitability of rental houses in Alicante does not cease to bring joy to their owners. The report, which was made public, is the result of comparing the average total housing price in the province with the average housing prices, according to the statistics of the Ministry of Transport, Mobility and Urban Agenda. Rental price in 2021 and 2022 significant warming of prices in this region.
In addition to being above pre-pandemic levels, the growth was remarkable compared to 2020, when the yield was 5.6%, and 2021, when it was 5.3%.
However, and as stated in the report, the profitability of the lease remained under the weight of the significant rise in housing purchase prices.Although it was significantly lower than the rent, it was enough to vacate it significantly. As the study states, “As profitability is the result of the ratio between the rental price and the price of the house, rents may be relatively high or low, but their gross profitability will largely depend on the value of the denominator; i.e. the price of the house”.
so and if Last year, the average annual rental price in the province was 9 thousand 405 euros.Its profitability decreased, up almost 15% compared to 2021, but its profitability decreased due to the increase in the average house price of 155,023 euros in 2022, 6% more than the previous year.
The report does not hide the paradoxical nature of this situation, since, as its authors argue, “over long periods, rents in general are limited to more increases than the price of housing. Rent rises, but usually not in proportion to the price of the house, resulting in a slight decline in maintenance or profitability. However, experts add, “This did not happen in 2022, when rents exceeded the percentage of housing prices in Alicante.”
On the other hand, in the Valencian Community as a whole, Valencia is the most profitable province to rent a house with an annual average of 8.3%.. For its part, the average profitability in Castellón is 7.6%. In addition, the three provinces easily exceeded the national average profitability of 5.8% in 2022.