The Build to Rent (BtR) model, translated as "build to rent," was born in association with large funds and new-build residential developments intended entirely for rental. However, in the Valencian Community, it is taking on a new form: the intelligent conversion of existing homes, many of them in tourist, urban, or coastal areas with high demand for quality rentals.
The shortage of new construction in certain high-value areas, combined with a large property portfolio with renovation potential, has opened the door to a new generation of investors: from forward-thinking individuals to small estates that renovate, furnish, and rent out with a professional approach.
According to recent data from the Valencian market:
• Medium-term (3-11 months) and long-term rentals have skyrocketed in municipalities such as Dénia, Jávea, and Altea.
• The cost of a complete renovation is lower than that of buying a new home, but it allows for a 30% to 60% increase in rental value in stressed areas.
• Many properties inherited or closed since the pandemic are becoming renovated and well-managed rental products.
This context generates a virtuous cycle: the real estate market is revitalized, the market is professionalized, and profitability increases in the medium term.
We're not just talking about building from scratch: in many areas of the Valencian Community, truly profitable BtR involves identifying assets with potential, renovating them with efficiency criteria, and adapting them to the most sought-after tenant type (local families, digital nomads, displaced professionals, etc.).
Advantages:
• It requires a lower initial investment than a development.
• It allows you to enter the BtR market without the need for large funds.
• It offers flexible taxation, especially if structured as a company.
Key points for choosing the right property:
• A location with proven demand.
• Adaptable property type (spacious apartment, single-family home with possible divisions, etc.).
• Renovations aimed at energy efficiency (key to increasing value and justifying the price).
• Professional management or through specialized platforms.
This "Mediterranean BtR" is attracting very diverse profiles:
• Heirs who transform an empty family home into a productive asset.
• Local investors who renovate old apartments for medium-term rentals.
• Foreigners who buy properties with rental potential after renovations.
• Micro-developers who renovate entire buildings to increase profitability unit by unit.
The interesting thing is that you don't have to be an investment fund to get in on the action. You just need to understand the tax framework, choose the right asset, and design a management system that provides security for the tenant and profitability for the owner.
Although there are no specific regulations for Build to Rent, there are tax tools that allow you to optimize this type of transaction:
• Holding companies: allow you to group several assets and deduct renovation, management, and amortization costs.
• Municipal bonuses: some city councils offer incentives for renovation or energy efficiency.
Of course, legal management must be well planned from the beginning: building permits, energy certifications, secure rental contracts, registration as a landlord with the Tax Office... This is where a good tax and real estate firm makes the difference.
Build-to-Rent (BtR) is not only here to stay, but is also adapting to the landscape, and the Valencian Community is one of the most active laboratories for this transformation. The growing interest of government agencies in controlling tourist rentals has brought the focus back to residential and professional rentals.
Meanwhile, the opportunity remains open: there are still hundreds of properties with potential that could be transformed into rental-ready homes in high demand.
You don't have to build a development from scratch to benefit from the Build-to-Rent model. In the Valencian Community, there is a more direct and profitable route: find the right property, renovate it with foresight, and structure it legally and fiscally to turn it into a stable and secure asset. New is not always better; transformed, well done, can yield even more.
