Uw succes is ons succes!

How to calculate the value of your property

Setting the right price for your villa or apartment can be an emotional and challenging process. In this guide, we will outline some objective methods to help estimate your property’s value. While these are general guidelines tailored for our local region here for such as Alfaz del Pi, La Nucia, and Altea, keep in mind that unique features of a property like location, quality of the structure, sea views, orientation, total privacy, whether it is reformed or not, age  or even solar panels may significantly impact the final valuation.

Another important part of the valuation process is analyzing comparable properties in the area, as well as specific features.

Also within the same building in an apartment block for instance, an apartment’s value may vary significantly depending on whether it’s on the first floor or the top floor.

Broader factors also play a role, such as macroeconomic trends like supply and demand in the housing market, or the land’s classification as urban or rustic. Local infrastructure and future developments – such as new commercial centres, industrial zones, or road constructions – can also influence value. On a microeconomic level, changes in the socioeconomic activity of a particular area can either enhance or diminish property values over time.

Example Valuation for a Resale Villa

One method is to use data from architects or specialised platforms to identify the average sales prices of villas in the area. These averages consider properties sold this year while filtering out extremes – villas priced above €500,000 or below €100,000.

For example, for January 2024, the average prices per square meter in our region are as follows:

  • Alfaz del Pi: €2,087/sqm
  • La Nucia: €2,013/sqm
  • Altea: €3,060/sqm

 

What Do These Prices Represent?

If your expected price differs significantly from these averages, it’s worth reflecting on why. Remember, these figures reflect a range of properties. For example:

  • In Alfaz del Pi, some villas might sell for €2,000/sqm with features like new kitchens, modern bathrooms, sea views, and total privacy.
  • Conversely, older villas from the 1960s or 1970s might sell for as low as €1,300/sqm.

 

A Second Approach: Rental Yield Calculation

Another way to estimate your property’s value is by evaluating its rental potential. There’s a common relationship between rental income and property prices: a 5% gross return is often expected by investors.

Example:
If a villa is worth €300,000, the expected annual rental income would be €15,000 (€300,000 × 5%). Divided over 12 months, this equals a monthly rent of €1,250. Is this a realistic rental amount for your property?

Using these two methods, here’s an example valuation for a second-hand villa of 180 sqm:

Alfaz del Pi:

    • Sales Price: €2,087/sqm × 180 sqm = €375,660
    • Expected Rent: €1,565/month

 

La Nucia:

    • Sales Price: €2,013/sqm × 180 sqm = €362,340
    • Expected Rent: €1,509/month

 

Altea:

    • Sales Price: €3,060/sqm × 180 sqm = €550,800
    • Expected Rent: €2,295/month

 

Investment Valuation for a Resale Apartment

For investments, the 5% rule is even more critical since these properties are often purchased as investments to generate rental income. Let’s calculate the valuation for a 90 sqm apartment:

Alfaz del Pi:

    • Sales Price: €2,087/sqm × 90 sqm = €187,830
    • Expected Rent: €780/month

 

La Nucia:

    • Sales Price: €2,013/sqm × 90 sqm = €181,170
    • Expected Rent: €754/month

 

Altea:

    • Sales Price: €3,060/sqm × 90 sqm = €275,400
    • Expected Rent: €1,147/month

 

Key Questions for Sellers

If your rental yield falls below 5%, ask yourself:

  • Is the rent too low?
  • Is the asking price too high?


For example, if you’re selling an apartment in La Nucia for €200,000 but local rents average €500/month, the gross ROI is only 3%. After subtracting community fees and property taxes, the return becomes even lower.

Conclusion

Average property values are exactly that – averages. If your asking price is significantly higher than the regional average in Alfaz del Pi, La Nucia, or Altea, ask yourself why. Does your property offer unique advantages, or is the valuation based more on emotion than objective factors like square meters and market trends?

For an honest market price, seek advice from experienced professionals. We’re here to help you navigate this process and ensure your property is priced to attract buyers while reflecting its true value.

Open chat
1
Let's chat!
Hello! What brings you to Solalbir today?
Hallo! Hva bringer deg til Solalbir i dag?
Hola! ¿En qué podemos ayudarte hoy?
Hallo! Wat brengt je vandaag naar Solalbir?