Normally if you buy a new well-maintained property, the home is worth more than the plot of land. In Sotogrande, we have property over 50 years old, which if not well kept and modernized, the plot would probably be worth more today. This applies particularly to the Sotogrande Costa properties located in the Kings and Queens area of the resort. The physical structure itself, appliances, and materials usually depreciate over time, assuming of course everything in the home is left original.
Index
1.- Primary vs secondary residences
2.- Enhancing the value of the villa
3.- Land value
Primary vs secondary residences
Naturally, most homeowners in Sotogrande have updated and repaired their villas over the years. However, many of these properties over 50 years of age were built as holiday homes and used principally in the summer. Today second residencies in Sotogrande are used year-round principally due to the improved road infrastructure in Spain which makes Sotogrande much more accessible from places like Madrid and Sevilla, but also due to cheaper air travel from many other European cities. The pandemic has also made many occupy their homes during the non-holiday times of the year.
enhancing the value of the villa
Many traditional Sotogrande homes are no longer fit for purpose, an example being the need for winter heating or workspace for working from home. Over the past two years, we have seen the sprouting of cranes all over the lower side of Sotogrande, meaning old villas have been knocked down and new modern properties being built in their place. The longer you stay with any property, the more you will need to improve the property to maintain the value of the home itself. If you do not, when selling the home it will not be valued as much as the land. There are several reasons to upgrade and improve your Sotogrande home. These can be simply to improve functionality to meet 2022 lifestyle living, or to lower energy costs, or to increase space or to change a style or look and feel. All of these will enhance the value of your home.
Land value
The value of the plot is much easier to predict in Sotogrande. Much depends on its location. A home within proximity to beach clubs, racquet centres, marina restaurants, and other attractions on the costa side will generally have a higher land value compared to a home farther from these amenities. But those amenities and their desirability can change if the homeowner values panoramic sea views, which are generally not available from the flat Costa side of Sotogrande. Wherever you are in Sotogrande south and west-facing plots will probably be worth a little more than east and north.
If you’re buying a home with a sea view or near the coastline in Sotogrande then odds are good that its value will appreciate, but of course, land value is never guaranteed.
Personal thoughts
Anyone buying a property in Sotogrande will eventually sell. I get very different reactions from applicants when I ask them about their exit strategy. After all, they are looking to buy not sell. The reason I ask is simple. Unless you are a full-time resident having a second home is temporary. Everyone’s circumstances change. It could be that children at school have finished their studies at the International School, and the home is now too large for Mum and Dad on their own. It could be that financial circumstances have improved and the family wish to get a bigger property or find a second home elsewhere. It may also be that age has caught up with one and going back to one’s country of origin is a preference. Whatever the reason selling will be easier or harder depending on the value and location. Understanding relative value within Sotogrande before you buy will undoubtedly help when it comes to selling.
Do you have an exit strategy?
Charlie.
