Investment Property in Madrid

Invest in Real Estate in Madrid

Madrid property investment can be a worthwhile venture if you are selective with the areas you choose to invest in. If not, you could find that your investment suffers due to low rental yields, dwindling demand, and slow property price growth in many parts of Madrid .

Search Map of Madrid Investment Real Estate

Madrid ( mə-DRID, Spanish: [maˈðɾið]) is the capital and most populous city of Spain. The city has almost 3.4 million inhabitants and a metropolitan area population of approximately 6.7 million. It is the second-largest city in the European Union (EU), and its monocentric metropolitan area is the third-largest in the EU. The municipality covers 604.3 km² (233.3 sq mi) geographical area.

Madrid lies on the River Manzanares in the central part of the Iberian Peninsula. Capital city of both Spain (almost without interruption since 1561) and the surrounding autonomous community of Madrid (since 1983), it is also the political, economic and cultural centre of the country. The city is situated on an elevated plain about 300 km (190 mi) from the closest seaside location. The climate of Madrid features hot summers and cool winters.

The Madrid urban agglomeration has the second-largest GDP in the European Union and its influence in politics, education, entertainment, environment, media, fashion, science, culture, and the arts all contribute to its status as one of the world’s major global cities. Due to its economic output, high standard of living, and market size, Madrid is considered the major financial centre and the leading economic hub of the Iberian Peninsula and of Southern Europe. The metropolitan area hosts major Spanish companies such as Telefónica, Iberia, BBVA and FCC. It concentrates the bulk of banking operations in the country and it is the Spanish-speaking city generating the largest amount of webpages.

Madrid houses the headquarters of the UN’s World Tourism Organization (UNWTO), the Ibero-American General Secretariat (SEGIB), the Organization of Ibero-American States (OEI), and the Public Interest Oversight Board (PIOB). It also hosts major international regulators and promoters of the Spanish language: the Standing Committee of the Association of Spanish Language Academies, headquarters of the Royal Spanish Academy (RAE), the Instituto Cervantes and the Foundation of Emerging Spanish (FundéuRAE). Madrid organises fairs such as FITUR, ARCO, SIMO TCI and the Madrid Fashion Week. Madrid is home to two world-famous football clubs, Real Madrid and Atlético Madrid.

While Madrid possesses modern infrastructure, it has preserved the look and feel of many of its historic neighbourhoods and streets. Its landmarks include the Plaza Mayor, the Royal Palace of Madrid; the Royal Theatre with its restored 1850 Opera House; the Buen Retiro Park, founded in 1631; the 19th-century National Library building (founded in 1712) containing some of Spain’s historical archives; many national museums, and the Golden Triangle of Art, located along the Paseo del Prado and comprising three art museums: Prado Museum, the Reina Sofía Museum, a museum of modern art, and the Thyssen-Bornemisza Museum, which complements the holdings of the other two museums. Cibeles Palace and Fountain has become one of the monument symbols of the city. The mayor is José Luis Martínez-Almeida from the People’s Party.

The financial stability of Madrid has translated into a real estate market that rewards forward planning and a willingness to look beyond areas of traditional affluence.

Buy to Rent in Madrid

Renting out your Madrid buy-to-rent investment property can grow wealth and income.

Whatever your goals with investment property in Madrid are – preparation is key.

Set goals based on how much rental yield will be required and the local rental yield rates in Madrid and be prepared to change your initial outlook.
Thoroughly research the Madrid location with a special emphasis on fringe areas outside the main Madrid metropolis that may be valued lower than their better-known neighbors. Rental yields of around 5% are still attainable in certain areas of Madrid.
Ensure that your target investment property in Madrid appeals to professionals. This is a demographic that ensures maximum income and low voids.
Finding and vetting suitable tenants is a job ideally left to the professionals. Working with an established letting agent with local knowledge and experience of property legislation will give you the best chance of success.

With our expert guidance, investing in Madrid provides the secure knowledge that your money is working harder than it would in a local Madrid bank and that future generations of your family will be left with substantial capital growth assets.

We are always happy to advise on buying investment property in Madrid, where we have been established for over 35+ years. Physis Realty has been a firm fixture in the Madrid property market through good times and bad. Our experts have seen it all and our portfolios continue to outperform.

Flipping Investment Property in Madrid

Flipping property in Madrid

Flipping property is when we advise clients to buy a Madrid property below market value, renovate it and then make a profit by selling it at a higher price, all within a few months, and often before the Madrid market has a time to react to the renovation.

The Flipping Strategy in Madrid

Investment property flipping in Madrid is a simple strategy. You find a property that is in need of renovation from our list and purchase it for a low price. These type of Madrid real estate investments are sometimes referred to by professionals as ‘distressed’ Madrid real estate.

What is distressed Madrid property:

Madrid property in need of renovation
Madrid real estate with a change of purpose and use
Oversold Madrid property
Bank repossessions in Madrid

Put simply, long term investors in Madrid purchase the property, renovate it and make it a lot more attractive to potential buyers.

Calculate profit that you make from Madrid investment property flipping:

Final Selling Price less Cost of Purchase less Costs = Profit

Here is an example:

Madrid property purchase price: $220,000

Renovation costs: $20,000

Other costs: $25,000

Property sale price: $400,000

Profit: $135,000

Experienced property developers in Madrid use a minimum profit value of 22% when looking at potential Madrid projects.

The reason for this is because there are lots that can go wrong in Madrid property flipping and working on a potential margin of 22% should still leave a good margin of error.

Invest through a Fund in Madrid

Property Secured Investments is a Private Equity fund that invests in Madrid and many other towns and cities across Europe. The fund is only available to Sophisticated Investors and closed to United States Citizens. While this is not an offer or promotion of the fund, more information can be found at the website

Luxury Property in Madrid

For luxury property investors hoping to add a superb property in Madrid to their luxury real estate investment portfolio, Physis Realty is a trusted partner.

A world leader in luxury real estate with a portfolio comprising some of the most sought-after real estate in Madrid, Physis Realty caters particularly to high net-worth individuals and families. A luxury real estate investment in Madrid should be entrusted to only the highest-quality agency.