Turning Sand Into Money

Real Estate

buying next to a beach was the best move i spanish charm and character — “Buying next to a beach was the best move I ever made, personally and financially.”
©Ronan McMahon

I love having a beach as part of my daily routine. In Praia d’El Rey resort, where I own a condo on Portugal’s Silver Coast, the Atlantic crashes onto a stunning swath of sand running for miles. Perfect for strolling and thinking. I often use it as my outdoor “office.”

Then, from my condo in Cabo San Lucas, Mexico I walk a few minutes to a glorious Pacific beach where whales often breach close to shore, the sunsets are incredible, and again, I often find myself strolling the sands, mulling over the latest real estate deals I’ve come across or an emerging trend that’s changing the real estate market.

But, there’s something else I love about beaches… I love how the best beaches draw renters to boost my income. I like spending time in Cabo…but when I’m not there, my condo can rent long-term for about $3,500 per month. And best-in-class real estate like this will only become more scarce and desirable.

Last summer I rented out my beachfront condo in Praia D’El Rey and was able to generate enough rental income in 10 weeks to cover my entire costs (including mortgage) for the year. In four weeks alone, I’ve received €7,000 straight into my bank account from renters.

And then there’s the capital appreciation. When my neighbor listed their condo (the same unit type as mine) last year, it was for €95,000 more than I paid only two years ago.

According to Knight Frank’s Global Buyers Survey, waterfront real estate adds an average price premium of 40%.

Beachfront real estate…even more, with an average premium of 60%. But when you buy well in a beach destination on the up, your gains can be so much higher. In Cabo, for instance, I’m staying in my condo that I bought as part of a Real Estate Trend Alert deal in 2015. The RETA price for this condo was $336,156. And recently I saw a listing for a similar condo two floors up going for $725,000 (a few weeks before I was offered $600,000 for mine).

Being close to a beach is integral to nearly every deal I get in on. But with the most recent beach deal, I found something that might be even more rare. Because I can’t walk from either beach, in Portugal or Cabo, into the very heart of an international city…

But I will be able to do that when I take possession of my condo in Corasol, a stunning gated golf community right on the Caribbean and right next to all the buzz and action of vibrant Playa del Carmen. It’s a tranquil oasis of luxury on the doorstep of the Riviera Maya’s vibrant low-rise beach city…with its own beach and stunning amenities of a high-end 5-star resort.

It’s a place I can see myself spending a lot of time. But more importantly, it’s a place I see lots of other people spending time too. Vacationers, remote workers, retirees, expats, snowbirds, you name it. They’ll all want to stay here. And they’re all part of the renter pool I’m tapping into.

Like I say, I love having a beach figure in my daily routine. It provides me with a tremendous sense of relaxation and calm. And by owning next to one, it provides me with enormous financial peace of mind too.

Your Real Estate Questions Answered

pretty estepona is full of traditional spanish charm and character — Pretty Estepona is full of traditional Spanish charm and character.
©iStock/E55EVU

◼ Tom asks: Hi Ronan. I’ve followed your comments and words of advice for a long time. We are planning to move to the Costa del Sol, Spain, part-time and go back and forth to Orlando, Florida. We like the area around Marbella—Puerto Banús to be specific. We like Old Town Marbella if you know that area. Can you recommend other nice areas like that but with a smaller price tag?

◼ Ronan says: Hi Tom. My recommendation is to check out Estepona. It’s only about a 20-minute drive west of Puerto Banús and Marbella, but in my opinion it’s a lot nicer. It’s not overbuilt, it has a beautiful palm-lined promenade next to a nice beach. And it feels more traditional and vibrant. Best part: It’s a lot less expensive.

Estepona has also been coming into vogue in recent years too, thanks to a Path of Progress that has been moving west along the coast. On my last visit, I was blown away by how much this town had come to life. Great restaurants, a revitalized Old Town, and lots of incredible murals adding to its unique character. It has also retained much of its traditional Spanish charm in a way that many other towns along this coast have not.

If I were to pick a place to live and invest on the Costa del Sol, Estepona would be close to the top of my list.

Editor’s Note:Ronan McMahon is the editor of Real Estate Trend Alert and a contributing editor to IL. Email Ronan with your real estate questions and comments at mailbag@internationalliving.com. We may publish your question along with Ronan’s reply in IL Postcards or here in IL magazine.