Over a carrot and ginger juice at the Tao Wellness Center, Geoffrey Donoghue was musing over the state of his particular market.
Geoffrey’s my Costa del Sol contact. We were together for our inaugural Gathering on the Riviera Maya—an event bringing together my contacts and fellow Real Estate Trend Alert members from all over the world.
The Gathering was a lot of fun and there were plenty of good insights…
Such as those Geoffrey was musing over.
In Spain, on the southern coast where we’ve identified the best opportunities, the bounce back in values on the best deals is playing out even faster than expected.
And now we have another deal there that you can act on as a Real Estate Trend Alert member.
Next month Geoffrey plans to list a resale at the Seniorio de Gonzaga community for €225,000 ($246,100). This is the opportunity I told Real Estate Trend Alertmembers about in February 2014. Our prices then were from €139,000.
I figured values at Seniorio would get back to the €250,000-range within five years.
This play is more than on track for that. In fact, it’s on track to double within three years. For folks who bought with a mortgage, the cash-on-cash upside is even stronger.
Deals like this are becoming more and more difficult to find. The best deals sell out fast—some literally in days. And banks also very quickly increase the pricing on their fire-sale releases. Maybe the first five condos list for €139,000. And, go up by €10,000 every five or 10 condos sold. They create a frenzy and quickly end up selling in the €170,000s.
But we want to buy at the lowest price possible locking in the gain. By the time the frenzy is midway through, pricing is no longer interesting to us. It’s what I consider ”retail,” or fair value.
Geoffrey came to the Gathering with a hot-off-the-presses opportunity. The back story is the familiar formula for the type of opportunity I like: The developer built condos in a prime locale west of Marbella before the crash hit. By the time construction was completed, there was no market. Nothing happened…until right now, that is.
Now the developer is fire-selling the completed condos. Prices for the first few condos start at €139,000 ($151,750). That’s a killer deal.
The market for quality real estate in a prime location like this has turned. A fund has invested in the project. That means that not only can these condos be tidied up, but the new owners have big plans to start selling pre-construction of new phases. I expect pre-construction prices to be significantly higher again. The new owners have a grand plan that could add significant value to the condos we can buy.
So…not only can we buy at on-the-floor, fire-sale prices, but we can benefit from future improvements.
If the Costa del Sol has been on your radar, then I strongly urge you to visit now. The best opportunities pass in a matter of days. So you need to visit and check out the opportunities in the pipelines. Then, be ready to act the minute the opportunity opens.
Geoffrey has agreed to host a small group of 13 members this February 25–28. You’ll get to see exactly where we have these strong deals. And where the new opportunities are likely to present themselves.
Each member pays their own way. You pick up your hotel and dinner tab. That’s it. There’s no other charges for this members-only scouting trip.
You’ll follow the Path of Progress west from Marbella towards Gibraltar where we are in the final moments of a once-in-a-generation opportunity to buy quality in a high-demand locale for less than what the condo would cost to put there. I expect strong capital appreciation as the crisis rolls through.
The Costa del Sol offers the best short-term rental market in all of Spain. So we can generate strong income while we wait for a bounce back in values.
I’ve seen the best fire-sale deals in this area rise in value by as much as 75% in the past two years. These ”best” fire-sale deals are becoming more difficult to find. Not every opportunity on this coast is a buy. There’s a lot of junk being sold…and we only buy best in class, where a bank or investor has to sell quality homes or condos fast.
This is a Real Estate Trend Alert members-only scouting trip. Research. Buy if you come across the right deal for you. But if the deal or time isn’t right, then use this trip for fun.
Wishing you good real estate investing,
Ronan McMahon