José Luis Nevado is the CEO and founder of Grupo Vive, a company with more than fifty employees and which has sold more than six thousand properties in its 21 years of existence. This electronics engineer and master of the Institute … San Telmo held management positions at Abengoa before leaving and starting his own business in an area like real estate about which he knew almost nothing. Two decades later, after beginnings that he admits were “very difficult”, he can boast of having survived the 2008 crisis and the pandemic, winning prizes last year such as best national real estate advice and management. And, paradox of life, he was responsible for selling the building that Abengoa owned on Buhaira Avenue.
-Can you still get a good deal or bargain in your area?
-Let’s see. What is a bargain or bargain?
-Something priced 20 percent (or more) below the market price.
-There are many cases. If you travel the world, you realize that Seville has magnificent prices. In other words, I can sell you a brand new house, with garage and photovoltaic panels, for 240,000 euros in Mairena del Aljarafe. And we have the beach next door, you go to Dublin and that same house is twice as big and the sun never rises there.
-Maybe you don’t have to go that far. In Madrid, they are already double.
Yes, but Madrid is an impressive city, a big city… Here, for 2,500 or 3,000 euros per square meter, you can find very good things. And what I say about Seville, I can say about almost all of Andalusia, excluding part of Malaga.
-But prices keep increasing.
-Like everything: coffee, beer…
-Tourist apartments have made everything much more expensive.
-Yes, tourists have not done any good for traditional rentals, which have done well. Despite this, in Seville they are still cheap compared to other places. I can tell you that there are cities where what is rented is not the room but the bed or a bunk bed for 450 euros. What you pay for is the bed and you share the room with one or two people. This is happening in Barcelona and perhaps also in Madrid. And if it happens there, it will happen here too. In my opinion, prices will continue to rise.
-I suppose that by building more housing and removing obstacles for public or private developers, this increase could be stopped. Is it easy to build in Spain?
-It’s easy, but I say it in quotation marks. The bureaucratic question depends on the municipalities and administrations. There are places where there is more soil, and there are places where there is less. Many municipalities are releasing land. But even if you own land, construction costs what it costs. The minimum construction costs you a thousand or a thousand hundred euros per square meter, even if they give you the land. And then you have to give him the optional direction of the project, which is done by the architects. You have to do a geotechnical study, you have to pay insurance, you have to pay the bank, and the bill increases. And with every step you take, you have to add 21% VAT. The builder buys the materials with 21% VAT, the carrier brings them to you and charges you 21% VAT and everything constantly goes into the state coffers. Over the course of the construction cycle, from the first brick that comes in, you pay 21% more for everything, making the cost of a house much higher. There are many taxes throughout the cycle that cause the price of a new home to increase in a geometric progression. If the price is X with taxes, it is set at 4X. And the developer, after all these taxes, has to pay 25 percent of his profit. In other words, you don’t stop paying taxes.
-I am asking you for advice for a young person who wants to buy a house.
-The first thing you need to do is put yourself in the hands of a professional to see your financial capacity and be realistic so as not to embark on something that is beyond your control. I don’t think many people achieve their dream home, so to speak. Another tip is perhaps to buy somewhere less expensive than the one you like the most. I remember an architect friend telling me that he wanted to live in a certain area of the city, but that the apartments there cost over a million euros. And his solution was to buy two apartments for 250,000 euros and rent them; and with the rent money, pay the rent in the neighborhood where he liked to live. It’s a good option.
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