Home Searching in Gibraltar: A Nook Townhouse on Essential Avenue for $1.9 Million
Five bedrooms and two retail spaces in Gibraltar
$ 1.9 MILLION (1.4 MILLION BRITISH POUNDS)
This three story townhouse is located on a busy corner of Main Street in the heart of Gibraltar, the 2.6 square mile British overseas territory on the southern tip of Spain. The building comprises a 3,300 square meter duplex residence with five bedrooms, two bathrooms and a ground floor with two retail spaces.
The 18th-century building received cosmetic touches about five years ago, including new paintwork, polished floors and a refreshed kitchen, said Sammy Armstrong, founder and general manager of Savills Gibraltar, who jointly lists the property.
A street level door opens to a hall with stairs to the second floor. From the landing, a hallway leads past an office, bedroom and dining room with double doors and a fireplace in the center of the house. At one end of the hall, across from Main Street, is a spacious living room with a fireplace, sash windows and views of the Rock of Gibraltar. Ms. Armstrong said the room was bathed in natural light because it was open across the street from the Magistrates’ Court gardens in Gibraltar. At the other end, at the back, is the kitchen and bathroom.
The third floor has a similar floor plan with a long central hallway connecting the rooms from front to back. At the front, above Main Street, is the master bedroom with an adjoining living room. Three more bedrooms line the hallway, a bathroom and a laundry room that opens to a roof terrace in the rear.
What makes the house special, Ms. Armstrong said, “is the view it has from its living room, overlooking the Courts Gardens, and the fact that your eyes are on the rocks. You can actually see the green of the rock. “
The ground floor retail space – currently a boutique and barber shop – generates an annual income of around $ 24,600 (£ 18,000), Ms. Armstrong said. The building is just a short walk from major Gibraltar locations including the famous Limestone Cliffs, Gibraltar International Airport and the southern Spanish border.
Known both as a tax haven and for its topography, Gibraltar was no longer a member of the European Union when Britain left the bloc in January 2020, despite an overwhelming majority of the territory’s 34,000 residents voting to remain in the EU agreement between the Spanish and British governments made it possible for Gibraltar to remain in the Schengen zone and to travel freely to most European countries.
The agreement should make Gibraltar “more attractive to both invest and reside,” said Sarah Bray, partner at ISOLAS, a Gibraltar law firm.
Ms. Bray said the company’s real estate division had a “very busy year” in 2020, with both transactions and prices rising across all levels of the housing market. “The property market in Gibraltar has continued to grow in recent years despite the initial uncertainty that Brexit brought with it when it was first announced,” she wrote in an email. “We see further interest in this area and a further increase in property prices. I believe we will continue to see a vibrant and active property market in Gibraltar going forward. “
The small area has become a hub for the online gaming industry and financial technology services companies in recent years, which together accounted for nearly a quarter of the region’s jobs in 2017, according to a House of Commons briefing paper earlier this year.
In 2020, buyers invested for a variety of reasons. Mike Nicholls, the CEO of Chestertons, a Gibraltar real estate agency, said demand from locals, many of whom have considered their housing needs during the pandemic, and buyers living in Spain has remained strong due to a new tax treaty intended to not to promote life in Spain while working in Gibraltar. About 75 to 80 percent of those who move, whether they buy or rent, are British, he said.
For “the thousands of workers currently living in Spain but working in Gibraltar, there is only all encouragement for them to come in, and many of them are. Not all. We couldn’t handle thousands. We can only handle hundreds, ”said Nicholls, noting that the housing market in Gibraltar is tiny – about half of the roughly 14,000 homes are government homes and half are private homes. A few hundred buyers can drive prices up.
As a result of the demand, Ms. Armstrong said, prices rose an average of 4 to 5 percent across the area, particularly for “good quality homes” priced above £ 500,000 ($ 684,000). These offers tended to lag in 2019, while in 2020, when fewer sellers tested the market, buyers considered more homes approaching £ 800,000 ($ 1.1 million).
“The difference is the clientele,” she said. “We’re seeing people coming to Gibraltar with bigger wallets.”
Many of these buyers flock to the barrage of new high-end developments on the territory. Jean-Paul Lugaro, the founder of Mulberry Real Estate, referred to Gibraltar’s “new, exciting projects,” including the recently launched The Reserve, which is located on the 1950s casino grounds, and the eco-luxury Arengos Gardens. that borders on a nature reserve.
The prices for affordable apartments rose by up to 5 percent in 2020, Lugaro estimated.
Upper Town, Gibraltar’s historic neighborhood built within the old city walls, has long been overlooked by investors but has seen a surge in “urban renewal” in the past four to five years, he said, especially among younger buyers. “It looks pretty exciting as the old town is brought back to life,” he said.
Who buys in Gibraltar
Mr Lugaro’s buyers are 60 to 70 percent local, while his overseas buyers are mostly British, “who love the British sense of lifestyle, security, education and the legal system but still want the Mediterranean weather”. German and French buyers have also shown interest recently, he said.
Working with more buyers from Russia, Israel and Australia in 2020, Ms. Armstrong found that she is “seeing more different nationalities”.
Most of Mr. Nicholls’ overseas buyers are from the UK, followed by the US, China and Hong Kong. Many newcomers to Gibraltar are workers in the local industries, including online gambling and insurance. “We attract entrepreneurs from Europe because of the low taxes and then we need the foreign language speakers to work for these companies,” he said.
The majority are British expatriates who lived in Spain and commuted to Gibraltar. “Brexit has pushed quite a few of them to Gibraltar,” she said. These are people who “lived in Spain for 10 years and thought,” We’re moving out of Europe, we don’t want to go back to the UK. “So they bought in Gibraltar instead.”
The rules for buying property have not been affected by the Gibraltar Brexit deal, Ms. Bray said.
Foreigners can buy real estate without restriction, although certain low-cost properties can only be bought under the state housing program by citizens of Gibraltar and those who meet a residence requirement. Most properties are leases with a typical term of 149 or 150 years, she said. (This property is owned.)
Transactions are handled by lawyers who work for buyers and sellers. The fee is usually between 0.5 and 1 percent of the purchase price, Ms. Bray said. Buyers also pay stamp duty on a scale.
“Mortgages for foreigners are examined on a case-by-case basis and vary from lender to lender,” she said. Transactions are conducted in British pounds or Gibraltar pounds.
Mr Nicholls said that the seller usually pays the real estate agent’s commission. There is no wealth tax, annual property tax or capital gains tax in Gibraltar.
Languages and currency
English; Gibraltar pound, British pound (1 pound = $ 1.36)
Taxes and Fees
Gibraltar homeowners pay maintenance fees for services such as garbage collection and street lights. The rate of this property is about $ 1,900 a year, Ms. Armstrong said.
Sammy Armstrong, Savills Gibraltar, 011-350-200-666-33; savills.gi
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