Practical case Mallorca: Historic townhouse in Sóller – Inheritance as part of the equity strategy
A few months earlier, the wife had inherited a property together with her siblings. After selling her share, equity was available that was to be used specifically for the purchase on Mallorca.
At a glance
- Purchase price: 1.260.000 €
- Renovation: 145.000 €
- Financing required: 882.000 €
- Equity: 686.800 €
Anonymised case figure · not a binding statement for other projects · §34i GewO
A house with history instead of a new-build property
A couple from North Rhine-Westphalia had originally looked for a modern villa on the coast. During a viewing tour through the north-west of Mallorca, however, they discovered the special charm of Sóller. Narrow lanes, historic façades and life on the market square won them over more than any new-build development.
In the end they chose an elaborately preserved townhouse from the early 20th century with a courtyard, a roof terrace and a view of the surrounding mountains.
Initial situation
A few months earlier, the wife had inherited a property together with her siblings. After selling her share, equity was available that was to be used specifically for the purchase on Mallorca.
Both had secure incomes and planned initially to spend several months a year on the island. In the long term, the townhouse was to become their permanent residence.
Financing overview
- Purchase price: 1.260.000 €
- Additional costs: 163.800 €
- Renovation: 145.000 €
- Total investment: 1.568.800 €
- Equity: 686.800 €
- of which from inheritance: 520.000 €
- Financing required: 882.000 €
The financing share corresponded to around 70 % of the purchase price.
The challenge
The building was in good structural condition, yet the building services, bathrooms and air conditioning were to be modernised. At the same time, it was important to fully preserve the historic character of the house.
In addition, the capital from the inheritance was to be used in a targeted way, without investing all available funds in the property.
Analysis
Already before the purchase, all planned measures were calculated together with specialist companies. This meant the modernisation costs could be realistically included in the total investment.
It was then examined which part of the inheritance should sensibly be used as equity and which financial reserves should be preserved for the future.
Financing solution
The financing was built at around 70 % of the purchase price.
The additional costs and a considerable part of the purchase price were paid from own funds. The modernisation costs were fully taken into account from the start and available immediately after the transfer of ownership.
Part of the inherited assets was deliberately kept as a long-term reserve.
Outcome
Once the work was completed, the townhouse combined historic character with modern technology and a high level of living comfort.
The couple could take over the property without financial time pressure and at the same time keep part of the inherited assets as a liquidity reserve.
What other buyers can learn
An inheritance often opens up new possibilities in a property purchase. Even so, not all of the assets have to be used. It is often more sensible to use equity in a targeted way and at the same time preserve financial reserves for future developments.
Frequently asked questions
Can inherited assets be used as equity?
Why were the modernisation costs taken into account before the purchase?
Is a historic townhouse financially riskier than a new build?
Conclusion
Buying a historic townhouse in Sóller shows how inherited assets can be sensibly integrated into a long-term financing strategy. Anyone who considers the purchase price, modernisation and liquidity reserves together creates a stable basis for acquiring a special property on Mallorca.
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To the theme → Costa BlancaPractical case Costa Blanca: Villa in Jávea
When a gift eases the path to a home in Spain
To the case report → Costa BlancaPractical case Costa Blanca: House in Benissa
Buying property after a larger inheritance
To the case report → MallorcaPractical case Mallorca: Beachside apartment in Cala d'Or
A parental gift sensibly used as equity
To the case report →A similar situation in Spanien? Let's talk.
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Book a free consultationAnonymised individual case, not a binding statement for other projects · Siegfried Perini, BAFA-notified for the cross-border activity of the owner Olga Nikushkina · §34i GewO · no tax or legal advice · no financing commitment; conditions depend on creditworthiness, loan-to-value and bank