I’m about to start renovating an apartment in the Right Eixample district of Barcelona to use as a family home. I’ll be writing about the experience as the works progress, to help others understand the challenge of renovation in Spain. I also hope to learn from readers who know more than me about renovation.
I’ve finally bought a property in Spain, with a big mortgage on my balance sheet for the first time in my life, making me feel grown-up at last. The property is a 3rd floor flat on the right side of Barcelona’s Eixample (Eixample Dreta) with approximately 215 square meters of floor space in need of total renovation.
My plan is to renovate the apartment as a family home to move into by the end of August 2017. As the flat needs complete refurbishment I’m allowing eight months for the work to be done after kicking off at the beginning of January, but hoping it will be done in six. If anyone has any opinion on the time-frame for a total renovation I’d love to hear from them.
Why now? I sat on the sidelines during the last boom, though to be honest I didn’t have the financial wherewithal at the time to buy even if I’d wanted to. I finally bought at the end of 2014 because I thought the timing was right (and still is), and have now got a mortgage to do the renovation. I believe that mortgage financing conditions are as good as they are going to get in my lifetime, and I expect that that house prices will rise in Barcelona, as will inflation in Spain. So to my mind it makes sense to do this now.
I’ve taken out a 30-year fixed-rate mortgage from CaixaBank with a headline rate of just over 3% that can be reduced by meeting conditions like taking out insurance with them. The final interest rate is still more expensive than taking out a variable-rate mortgage today, but I just can’t believe interest rates will remain so low forever. I’m betting they will rise above the fixed rate of interest I am paying at some point in the not-too-distant future. And with inflation in Spain currently running at 1.5% (December data from the National Institute of Statistics), the real interest rate I am paying today is less than 0.5%.
I’ve been banking with CaixaBank for the last 16 years, and the conditions for this mortgage looked so good to me I didn’t bother shopping around. CaixaBank have a network of offices around Spain specially geared up to help foreigners who need banking products and services like mortgages in Spain. These branches are part of the HolaBank network run by CaixaBank. You can find out more about HolaBank clicking the banner below. For the record, HolaBank advertise at this website, but that didn’t influence my decision.
I’ve already selected a builder, and have a detailed budget to go through to see what savings, if any, can be made. Then we start the building work, hopefully in early January, and I’ll be posting updates and learning here, in the hope that others benefit from the information, and I benefit from the input of others.