Renovation planned in: €532,000 loan for a finca near Santanyí
A family from Switzerland had spent their summers on Mallorca for many years. At some point the wish matured to no longer rent holiday homes but to own their own property. The choice deliberately fell not on a new build but on a traditional finca in the surroundings of Santanyí – with a natural-stone façade, old trees and a lot of potential.
Why should the planned renovation of a finca near Santanyí be included in the financing from the start?
Only then is the real financing need clear. The actual financing requirement can only be determined realistically, and later financing gaps avoided, if all planned modernisation is included from the start. Here the family obtained quotes for the planned renovation before the purchase, so the capital needed was clear before the notary appointment.
€760,000 finca, €532,000 loan, €411,800 equity
- Purchase price: 760,000 €
- Renovation: 85,000 €
- Financing required: 532,000 €
- Equity: 411,800 €
Anonymised case figure · not a binding statement for other projects · §34i GewO
Property for sale in Santanyí on Mallorca
The house was well-kept but no longer met today's requirements technically and energetically. The modernisation was therefore to begin directly after the acquisition.
A holiday home first, the family's main home later: The family of four had a secure income from two permanent employment relationships and saved equity. As the property was to be used first as a holiday residence and later become the permanent centre of life, durable, plannable financing played a decisive role.
Quotes for the planned renovation measures were obtained already before the purchase so the total costs could be calculated realistically.
€943,800 total investment, €85,000 of renovation included
The total investment of 943,800 € consists of the 760,000 € purchase price, 98,800 € additional costs and 85,000 € renovation. Equity was 411,800 €, the financing required 532,000 €.
Purchase price: 760,000 €; Additional costs: 98,800 €; Renovation: 85,000 €; Total investment: 943,800 €; Equity: 411,800 €; Financing required: 532,000 €.
The financing share thus corresponded to around 70 % of the purchase price.
Planning heating, windows, two bathrooms and grounds early: The main effort lay not in buying the finca but in planning in all modernisation measures early. Alongside new heating and air-conditioning technology, the windows were to be renewed, two bathrooms modernised and parts of the outdoor areas reworked.
The family wanted to avoid having to raise capital again a few months after the purchase.
The capital needed was clear before the notary appointment
Before the financing planning, all planned work was compiled in detail and backed with realistic costs. This meant the actual capital requirement could be reliably determined already before the notary appointment.
At the same time, care was taken to ensure that sufficient financial reserves still remained after all work was completed.
The financing planning was therefore oriented not exclusively to the purchase price but to the entire investment.
Purchase costs from own funds, 70% of the price from the bank
The additional costs were borne entirely from own funds.
A further part of the equity flowed into the acquisition, while the financing covered around 70 % of the purchase price.
The planned modernisation costs were included in the overall planning from the start and were available immediately after the transfer of ownership. This meant all work could be carried out without delay.
Technically up to date, Mallorcan character preserved: Just a few months after the purchase, the finca presented itself technically up to date, without losing its original Mallorcan character.
As all investments had been taken into account from the start, the financial planning remained stable and traceable even during the conversion phase.
Costing an older house's renovation realistically before buying
Older properties on Mallorca in particular are often convincing for their location, plot and charm. At the same time, necessary renovations should be realistically calculated already before the purchase. Anyone who takes these costs into account only later risks unnecessary financial pressure and additional organisational effort.
Santanyí finca financed with realistic reserves built in: Buying a finca in Santanyí shows that successful property financing goes far beyond the actual purchase price. If modernisation, additional costs and personal reserves are realistically planned in from the start, financing emerges that offers security over the long term too and places the dream of life on Mallorca on a solid foundation.
Frequently asked questions
How high should the financial reserve be after the purchase?
Alongside the equity for the purchase and additional costs, an additional liquidity reserve for unforeseeable expenses or personal changes is generally advisable.
Which renovation work was planned for the finca near Santanyí?
Alongside new heating and air-conditioning technology, the windows were to be renewed, two bathrooms modernised and parts of the outdoor areas reworked. The modernisation was to begin directly after the acquisition.
How were the additional costs of the finca purchase near Santanyí paid?
The additional costs were borne entirely from own funds. A further part of the equity flowed into the acquisition, while the financing covered around 70 % of the purchase price.
A similar situation in Spain? Let's talk.
Every financing in Spain is an individual case. In a free initial consultation I will tell you honestly what is feasible and which bank fits.
Anonymised individual case, not a binding statement for other projects · Brokerage under the §34i GewO licence held by Olga Nikushkina (D-W-132-ZUCB-95); Siegfried Perini registered as directly involved person (§11a GewO) · no tax or legal advice · no financing commitment; conditions depend on creditworthiness, loan-to-value and bank
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Content by Siegfried Perini — local brand representative since 2019, active in real estate since 1992, entered in the German intermediary register (§ 11a GewO) as a person directly involved in brokerage and advice. Point of contact for German-speaking buyers in Spain and Portugal. Brokerage by Olga Nikushkina, mortgage credit intermediary under § 34i German Trade Regulation (GewO); in Portugal through a locally licensed intermediary.