Primary or Secondary Market? What to Choose When Buying an Apartment in Spain

Primary or Secondary Market? What to Choose When Buying an Apartment in Spain

Purchasing an apartment in Spain is a dream for many, whether it’s for personal use, a second home, or as an investment. With its stunning beaches, sunny climate, and high quality of life, regions like Costa Blanca and Costa Cálida attract millions of tourists and new residents every year. One of the crucial decisions when buying property is whether to choose from the primary or secondary market. Each option has its unique advantages and considerations, so it’s important to determine which best aligns with your needs.

What Defines the Primary Market?

The primary market consists of newly built properties or those still under construction. When purchasing from this market, you become the first owner of the property.

Advantages of the primary market:

Advantages of Buying in the Primary Market

1. Modernity and High Standards
   Apartments in the primary market are often defined by modern design and top-quality construction materials. With a focus on energy efficiency, these properties typically feature advanced technologies that help reduce long-term operational costs. Developers also place significant emphasis on the aesthetics of the buildings, ensuring that the estates are thoughtfully designed with residents’ convenience in mind.

2. No Renovations Needed
   One of the main benefits of buying a new apartment is that everything is ready to move in, eliminating the need for any renovation or updates. Primary market apartments often come with high-quality finishes, including fully equipped kitchens with furniture and appliances, finished bathrooms, built-in closets in bedrooms, polished floors, and terraces. Many also feature ducted air conditioning and heat pumps, providing immediate comfort without any additional work.

3. Developer Guarantees and Support
   Purchasing an apartment in the primary market typically includes warranties on the building and its components. Developers are legally obligated to address any defects within specific timeframes after the property is delivered. For example, in Spain, new properties come with:

1. • 1-year warranty for defects in finishes
   • 3-year warranty for defects that impact the apartment’s usability
   • 10-year warranty for structural safety issues

4. Flexible Payment Options
   Many developers offer flexible payment plans for new properties. Typically, a large portion of the property’s price (around 70%) is due upon completion of construction and when the deed is signed. This provides time for buyers to organize their finances, apply for a loan, or pay in installments. Additionally, the property price is fixed once the contract is signed, offering financial certainty despite any market fluctuations during the construction period.

5. Potential for Value Growth
   Investing in new construction often leads to future property value appreciation. Given the ongoing demand for modern, energy-efficient homes, experts predict that Spanish real estate will see a 2% price increase by 2026, with continued growth in the years that follow. Choosing a new property now can be a wise investment, especially if you consider the rising demand for newer homes that meet current regulations and environmental standards.

Disadvantages of Buying in the Primary Market

1. Higher Price
   New apartments in the primary market can be more expensive compared to those in the secondary market. The higher price is often attributed to modern technology, energy-efficient features, and the cost of construction. Additionally, developers frequently build new developments in popular or sought-after areas, further driving up the price.
2. Long Waiting Time
   One significant drawback of purchasing an apartment in the primary market is the waiting time. If you opt for a property that is still under construction, you’ll need to be prepared for delays in receiving the property. The completion and handover of a new apartment can take several months, or in some cases, more than a year, leaving you waiting before you can move in.

What is the Secondary Market?

The secondary market refers to properties that have been previously owned and inhabited by other individuals. These properties can vary significantly in terms of age and condition, from relatively new apartments to much older homes. When purchasing from the secondary market, the buyer may face different challenges depending on the property’s age and maintenance history.

Advantages of the Secondary Market

1. Lower Price
   Apartments in the secondary market are often more affordable than those in the primary market, making them a great option for buyers on a tighter budget. Additionally, with older properties, there’s room for negotiation, which could lead to an even better deal.
2. Immediate Availability
   One major advantage of the secondary market is that the apartment is usually ready to move in immediately. There’s no waiting for construction to be completed, making this a great option if you want to settle into your new home quickly.

Disadvantages of the Secondary Market

1. Frequent Need for Renovation
   Many apartments in the secondary market may need some renovation or updates. Older properties can have worn-out fixtures that need to be replaced, resulting in extra costs and time spent on the necessary work.
2. No Warranty
   When buying an apartment on the secondary market, you won’t have the warranty provided by developers for new properties. Any defects that appear after the purchase will have to be repaired at your own expense.
3. Higher Maintenance Costs
   Older apartments can come with higher operating costs, particularly for heating, air conditioning, or other installations. These systems may not be as energy-efficient as those in newer buildings, leading to increased monthly expenses.