What is luxury real estate in Spain by regions: Marbella, Alicante, Barcelona

The real estate market has long been associated with reliability, stability, and the prospect of passive income. Advertising brochures and stories of successful investors shape the image of an ideal investment. However, in reality, many misconceptions hinder making an informed decision. These myths about real estate investments lead to incorrect assessment of income and expenses, blind faith in eternal price growth, and ignoring risks. A professional approach begins with dispelling illusions and moving on to the dry logic of numbers, documents, and the market.

Myth #1: Real estate always appreciates in value

Debunking the myth of real estate investments: the market is cyclical. Even in countries with stable economies, such as Germany or Canada, declines of 8 to 30% over a decade are recorded. In Russia, in 2015, apartments in rubles became more expensive, but in dollars, they halved in value. In the Moscow new construction market in 2023, stagnation was recorded: the price per square meter increased by less than 2%, with inflation at 11%.

Real reasons for deviations:

1. Market saturation.
2. Increase in housing supply.
3. Rise in the key rate of the Central Bank of Russia (in 2024 — up to 16%).
4. Tightening of mortgage conditions.

Myths about real estate investments often rely on the idea of endless growth. In reality, profitability without considering depreciation and inflation often does not exceed 3–5% per annum.

Myth #2: Rental income provides stable passive income

Renting out property is not always passive. Managing an apartment requires time, legal knowledge, and oversight. Vacancies, property damage, repair costs, non-payment — are common occurrences even in “liquid” locations.

Calculation example (Moscow, 2025):

1. Apartment cost 12.5 million ₽ (one-bedroom in a comfort-class residential complex).
2. Rental income 45,000 ₽/month or 540,000 ₽/year.
3. Expenses: taxes — 78,000 ₽, vacancy — 2 months (-90,000 ₽), repairs — 50,000 ₽, maintenance — 18,000 ₽.

Net income: 540,000 – 78,000 – 90,000 – 50,000 – 18,000 = 304,000 ₽ → yield ≈ 2.43% per annum. Conclusion: myths about real estate investments ignore real operational expenses, which consume a significant portion of the profit.

Myth #3: Investing in studios is always more profitable

Small size does not mean high profitability. Studios generate more income per square meter, but have lower liquidity, higher wear and tear, and more risks of vacancies.

Indicators for 2025 (Saint Petersburg):

1. Studio: 27 m², price — 5.3 million ₽, rent — 30,000 ₽.
2. One-bedroom apartment: 43 m², price — 7.9 million ₽, rent — 48,000 ₽.

Comparison:

1. Studio: yield — 6.7% (gross), but longer vacancies (on average 3 months).
2. One-bedroom apartment: yield — 6.1%, but higher demand for long-term rentals and families.

Risk factor: studios often fall into the economy segment with less financial stability of tenants.

Myth #4: Real estate investments are risk-free

Myths about real estate investments conceal many risks — legal, market, and infrastructural.

Real loss zones:

1. Developer goes bankrupt (example: Urban Group, 2018 — 14,000 equity holders affected).
2. Property not completed — need for lawsuits, compensations, shared equity construction fund.
3. Area loses attractiveness — changes in transport routes, emergence of industrial zones.
4. Property tax increase (in 2023 — 23% increase in cadastral value).

Conclusion: investments require legal expertise, technical assessment, and analysis of the district’s prospects. Relying on blind “intuition” leads to losses.

Myth #5: Yields of 8–10% are standard

In reality, such yields are only provided by rare deals with discounts, buying at the excavation stage, or participating in renovation. Average rental yield in million-plus cities is 2.5–5.2% per year.

Real cases:

1. Kazan: new construction, yield — 4.1%.
2. Krasnodar: secondary market — 2.7%.
3. Sochi (elite segment): vacancies up to 6 months → actual yield 1.9%.

Comparison: Federal Loan Bonds 26242 with a yield of 12.3% (as of June 2025) are often more profitable in terms of “risk/return” ratio.

Myth #6: Mortgage accelerates investment profitability

In conditions of high interest rates (in 2025 — 16–17%), a mortgage consumes all profitability. Even when rented out, the mortgage payment exceeds the rent.

Example:

1. Apartment: 9 million ₽.
2. Down payment: 2.7 million ₽.
3. Mortgage payment (17% for 20 years): ≈ 123,000 ₽/month.
4. Rental income: 55,000 ₽/month.

Monthly loss: ≈ -68,000 ₽ + insurance and taxes. Repayment comes from personal funds, not rental income. Conclusion: myths about real estate investments often rely on outdated rates from 2019–2020, ignoring the real cost of money.

Myth #7: You can do everything yourself

Debunking: self-management requires skills of a lawyer, real estate agent, accountant, and contractor. Mistakes in contracts, oversights in tenant evaluation, or incorrectly filed personal income tax declarations are a direct path to losses and fines.

List of key tasks in self-management:

1. Legal verification of the property.
2. Preparation of a lease agreement with force majeure clause.
3. Tax reports — annual declaration.
4. Control of payments and property maintenance.
5. Conflict resolution — before going to court.

Saving on an agent often leads to fines, long vacancies, and reduced income.

Myths about real estate investments: logic against illusions

A professional investor does not rely on intuition or rumors. The real market requires calculations, liquidity assessment, risk consideration, and understanding of financial scenarios. Myths about real estate investments conceal systemic errors: underestimation of costs, ignoring depreciation, belief in eternal growth. Profitability is only achieved with a sober approach, discipline, and technical analysis. Only then does real estate truly become a source of income, not a source of problems.

Valencia attracts attention as one of the best cities in Spain for permanent residence, work and leisure. The Mediterranean climate, affordable prices and developed infrastructure make the region interesting for different categories of citizens: families with children, retirees and entrepreneurs. Let’s take a look at the cost of living in Valencia in 2025 and whether it is worth deciding to move to this sunny Spanish city.

Cost of living in Valencia: general costs and budgeting

Compared to Barcelona and Madrid, Valencia maintains a significant price advantage, offering a balance of comfort and economy. According to current data for 2025, the monthly costs of a family of four range between €2,000 and €2,500. This covers the basic costs of housing, food, utilities and transport.

Real estate is the most significant item of expenditure. Renting a one-bedroom flat in the historic centre, such as El Carmen, costs an average of €900 to €1,200 per month. In more remote areas such as Benimaclet or Benimamet, similar properties rent for €600-800. Buying a home looks attractive to investors due to the relatively low prices. The average property in Valencia per square metre in the central areas ranges from €2,800 to €3,500, while on the outskirts and in new developments it drops to €1,500-2,000.

Food and nutrition prices: where to buy more favourably

The cost of living in Valencia reflects the availability of fresh and quality produce, which is easy to obtain in the city’s popular markets. These include Mercat Central, the city’s largest square with over 300 outlets, and Mercat de Russafa, a colourful format offering seasonal and local produce. The average monthly grocery budget for a family is usually around €400-600.

People buy fresh fruit and vegetables for between €1 and €2 per kilo, meat products for between €6 and €12, and a variety of seafood, including fish and prawns, cost around €8-15. Mercadona, a local supermarket chain, has the lowest prices for basic necessities.

Eating out in cafes and restaurants is also affordable. A set lunch in a typical café costs between €10 and €15, while dinner in a mid-range restaurant costs an average of €20-30. The city is rich in a variety of establishments serving traditional Valencian cuisine, making it possible to enjoy paella or tapas at reasonable prices.

Transport costs: what is more favourable to use

Transport also has a significant impact on the cost of living in Valencia. A well-developed public network consisting of buses, metro and trams allows you to move around the city efficiently. A monthly pass for all types of public transport costs €40-50, while a single journey costs €1.50.

A car is inexpensive: a litre of petrol costs approximately €1.60, and monthly rent for a public parking space ranges from €50 to €120. In addition, Valencia has a well-developed network of over 150 kilometres of bicycle paths, making the format a convenient and inexpensive alternative.

Health services and insurance: accessibility and quality

The cost of living in Valencia also includes the cost of medical care, which provides quality health care for residents. Spanish state medicine remains one of the best in Europe and provides free services for residents with residence permit or permanent residence permit. Most residents prefer non-privatised hospitals for the high level of professionalism of doctors. Private clinics offer the highest level of service with no queues and a personalised approach. The cost of health insurance here is about €50-80 per month, which favourably distinguishes Valencia from most other European cities.

The advantages and disadvantages of living in Valencia: what to consider when moving house

The cost of living in Valencia remains an important factor in the decision to move, so it’s worth considering all aspects.

Advantages:

1. Comfortable Mediterranean climate with mild winters and sunny summers.
2. Favourable prices for housing, groceries and transport.
3. High levels of security and low crime.
4. Numerous green parks and beach accessibility.
5. Friendly and relaxed atmosphere, ideal for families and retirees.

Disadvantages:

1. Seasonal price increase in summer due to increased number of tourists.
2. Limited career opportunities compared to major business centres.
3. Relatively high youth unemployment.

Whether it is worth investing in Valencia property in 2025

The Valencia property market attracts investors due to its steady yields and stable rental demand. The average yield from the rental of premises ranges from 5 to 7% per annum. At the same time, the annual growth in the cost per square metre reaches 3-5%. Investments look attractive for those who want to ensure a stable income or get a residence permit under the programme “Golden Visa”, buying a home from € 500,000.

The cost of living in Valencia and the general atmosphere of the city is ideal for several categories of residents, including:

1. Families with children due to the high level of safety, good schools and many parks.
2. Retirees looking for a quiet life by the sea with good healthcare and affordable costs.
3. Entrepreneurs interested in developing small and medium-sized businesses in a popular tourist destination with good conditions for opening cafes, restaurants, hotels or small shops.

Conclusion

The cost of living in Valencia as of 2025 remains attractive and favourable compared to other major European cities. High quality social services, affordable prices and favourable conditions for different categories of residents make the region an excellent choice for relocation and investment.