MADRID
Oliver Banks
Mark Harvey
Articles covered
As the Spanish capital, Madrid is well known for its vibrancy; a city that is densely packed with social, cultural and business opportunities, open 24 hours a day, 365 days a year. When it comes to leisure and culture, the capital’s offerings are seemingly endless: theatres, museums, art galleries, sports, shopping, education, restaurants, bars – there truly is something in Madrid to suit all ages and tastes.
Taking a break and breathing fresh air without leaving Madrid is easy thanks to the large number of parks and gardens in the capital. Right in the centre is the Parque del Retiro, built in the mid-17th century. It’s also the ideal place to make the most of the outdoor space, being the European capital with the most hours of sunshine.
Madrid benefits from a great geographical location in the heart of the Iberian Peninsula. From the city, you can reach any other part of the country easily, particularly thanks to Madrid’s great infrastructure which includes exemplary public transport. Madrid's subway is one of the most modern and efficient in Europe.
Many large national and international corporations have chosen Madrid to base their European headquarters, with global names including Amazon, Google, Microsoft and Samsung. The city, therefore, attracts many working professionals, either relocating through the corporate sector or choosing Madrid as the place where they want to begin their career due to its excellent quality of life and employment opportunities. Above all, Madrid is a modern urban centre with a dynamic society, that, beyond the hustle and bustle of corporate life, takes pride in its ability to have fun and make the most of its wonderful surroundings.
"Madrid is a modern urban centre with a dynamic society, that, beyond the hustle and bustle of corporate life, takes pride in its ability to have fun."
What can you get for your money in Madrid?
Knight Frank has listed all properties within the past 12 months.
Neighbourhoods to watch
Paseo de la Dirección, Tetuán area
Located in the district of Tetuán, this area went through a period of rejuvenation 10 years ago but has retained its characteristically diverse nature which forms the base of its appeal and personality. The cultural diversity and unique architecture consisting of tall buildings and historic low-rise houses shape the atmosphere of the neighbourhood. The bustle of the main street, Bravo Murillo, with its quirky shops, forms a very picturesque centre point of the community.
Arganzuela district
Arganzuela, located within the M-30 and east of the river Manzanares, is just below the heart of the city. Developed in the 70s, the district is one of Madrid’s younger hotspots, offering a dynamic and energetic atmosphere. From industrial beginnings, home to factories such as Fabrica de Gas, Fabrica de Osram and other railway companies, Arganzuela is now one of Madrid’s most trendy and desirable residential areas and is currently experiencing a ‘second youth’.
What’s driving demand
Local education
15/21
15 Universities / 21 international Schools Family deductions for various services and activities in public centres. Income based deduction for educational expenses at the second cycle of the Early Childhood Education stage, Compulsory Education and Basic Vocational Training, as well as for language teaching.
Reason for buying?
Profession
Technology
Sports
Media
Price per sq m:
Core: €3,800 Prime: €8,500 Super Prime: €15,600
Did you know
€500,000
The Golden Visa scheme offers residency to non-EU citizens in exchange for a property investment of €500,000, providing free movement within the Schengen area
Who's buying?
87% National 13% International
Reasons to buy
Madrid is the main economic engine of Spain and, in light of the pandemic, has one of the strongest forecasts for recovery within the country. As the capital city of one of the largest countries in Europe and home to global corporate names, its appeal will endure among young professionals and families looking for a city with a great climate and good quality of life.
The city also has fantastic transport infrastructures, great health services – which is sure to be higher up the priority list – and first-rate education centres. Demand for good quality homes in the rental and sales sectors is set to remain high for both domestic and international markets, with attractive profitability in comparison to other European markets, as well as easing access to financing.
Madrid also has several environmental schemes on the agenda, most prominently Arco Verde – a city-wide community project aimed at bringing citizens closer to nature. The goal is to eventually connect the three regional parks of the city with other natural spaces surrounding the 64 km Cyclist Green Ring, to help promote local biodiversity.
Madrid market in numbers
Whether it is for lifestyle or investment purposes, there can be extra costs that need to be considered in addition to the purchase of the property itself. While the cost of the property is by far the most significant expense, additional costs you may need to cover can include local fees, taxes, running costs and possible charges that will need to be factored in.
Purchasing costs
11.5%
The total percentage of purchasers costs involved in buying a property in Madrid, which includes:
Additional information
Costs include:
Notary fee paid by the buyer, usually 1% of the transaction value. For most transactions, this costs represents the legal or lawyer’s fee as well. Notary fees €400-€650. Public deed €600-€1000, lawyer fees circa 1% of the purchase price.
Definitions:
Rental yields: Based on gross income. Average rental: Based on prices per month. Prime market: The most desirable and most expensive property in a given location, defined as the top 5% of each market by value. Super prime market: The most desirable and most expensive property in a given location, defined as homes priced at more than US $10 million.
Investment breakdown
Core market
Rental yield: 4.8 % Expected running costs: €2.5 sq m Average rental: €15 sq m
Prime market
Rental yield: 3.0% Expected running costs: €4 sq m Average rental: €22 sq m
Super prime market
Rental yield: 2.7% Expected running costs: €8 sq m Average rental: €35 sq m
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Sources: 1. Knight Frank Madrid, 2.Knight Frank Research. This city guide is provided for general information only. It is not definitive, nor is it intended to amount to advice on which you should solely rely upon. As far as applicable laws allow, we do not accept responsibility for errors, inaccuracies or omissions, nor for loss or damage that may result directly or indirectly from reliance on or use of its contents.