Barcelona, seen as Europe's investment sweet spot for student rentals

BarcelonaBarcelona once again tops a housing-related ranking. But this time the focus is on investors and the comparison, on a European scale: the Catalan capital is ranked as the best university city in Europe for investing in student rentals, ahead of Madrid, Brussels, Milan, and Lyon. "It's lucrative: after all, there's always demand and you'll always have guaranteed tenants for at least nine months of the year," says the website Compare the Market, a British price comparison site based on data from Numbeo, the world's largest online portal with user-contributed data on cities and countries.

The study collects investment data based on four weighted variables: rental profitability, student population, rental prices, and general interest in student property investments

Barcelona, ​​​​a 5% return

The Catalan capital tops the European ranking because it has the third-best rental yield (5%) and a high student population, with 140,368 university students, according to this website. In contrast, Madrid, which hosts more students (153,714), is in second place because its profitability is lower (4.78%). This is explained by the fact that rent prices in Barcelona, ​​​​according to Numbeo figures, are higher than in Madrid, but per square meter is cheaper in the Catalan capital than in the Spanish one.

"Home to eight universities in total, we find the areas of Gràcia, with its galleries and independent shops, and well-connected public transport, and Eixample, with its café scene, museums, and libraries," notes the report, although Stephen, general manager of property management at Compare the Market, "does thorough research." He also points out that a higher acquisition cost also means a higher mortgage, which reduces the profitability of the investment, but he assures that university cities with a dynamic atmosphere "represent a potentially attractive destination due to the high demand for accommodation."

Beyond the top Five, led in the United States by Atlanta (Georgia), and in Australia by Perth, the report also highlights as European opportunities the cities of Dublin – where rental profitability is 6.7% – and Athens, which has the most affordable price per square meter in Europe.

Seasonal rental: one in four contracts

One of the ways investors have found to squeeze the profitability of rentals is the seasonal modality, which in Barcelona, ​​​​in the fourth quarter of 2024, already represented one in four new contracts (26.3%), according to data published by Incasòl two months ago, and which this Friday is collected in a new report by the Metropolitan Observatory.

This modality is in the middle of a regulatory phase in two ways: on the one hand, the Spanish government is deploying a mandatory registration without which temporary rental apartments cannot be marketed, and on the other hand, the Parliament is working on the future regulatory text of the Government's housing decree - which The Catalan chamber approved on April 9- to include a price cap for seasonal rentals that are not for "recreational, tourism, or holiday season uses," as the Catalan executive promised in exchange for the support of Esquerra, Comuns and the CUP to the decree.