Long-term rental yields in Alfaz del Pi and Albir: how to work them out with real figures

Gross and net rental yield: how to work them out

Gross yield = (monthly rent × 12) ÷ purchase price × 100. It’s useful for comparing areas and properties at a glance, but it isn’t what ends up in your pocket.

Net yield = (annual rent − annual costs) ÷ (purchase price + buying taxes and fees + any renovation) × 100. This is the one that resembles reality. Work it out before and after tax, and use the after-tax figure when comparing with other investments.

Two things people often forget. Counting twelve months’ rent a year assumes the property is never empty. And leaving the buying costs out of the investment makes the yield look better than it is.

Rents and prices in Alfaz del Pi and Albir

There are two public sources worth using, and each measures something different.

The Ministry of Housing rental index (SERPAVI) is built from landlords’ income tax returns. It shows what’s actually being paid on tenancies in force, including old ones. The latest published data are for 2024. For l’Alfàs del Pi, which includes Albir:

• Flats: median €7.88/m² a month, or €600 a month for a typical 81 m² flat (956 homes in the sample). The middle half of tenancies range from €6 to €10.32/m².
• Houses: median €7.29/m² a month, or €700 a month for a typical 127 m² house (297 homes).

RealAdvisor’s estimates combine listings, sales and valuations, so they’re closer to what you’d ask on a new tenancy today. For flats, in October 2026:

The last row isn’t a mistake. Many tenancies still running were signed years ago and have barely been reviewed, so the average declared rent lags the market. For a new purchase, the realistic figure sits between the two, closer to RealAdvisor’s if the property is in good condition and you let it now.

I haven’t included idealista’s rental report because I couldn’t access it. I’m not giving a yield for houses either: the house rent estimates I found weren’t consistent between areas. If yours is a villa, run the sum with a comparable rent from your own street.

The costs that eat into your yield

• IBI (council tax). You pay it. Since 8 October 2026 the law no longer lets you pass it on to the tenant.
• Community fees. You can agree the tenant pays them, but it has to be in writing in the tenancy agreement, stating the annual amount.
• Home insurance and, if you want it, rent-guarantee insurance.
• Upkeep and repairs. Boiler, air conditioning, appliances, the pool if there is one. By the coast, damp and salt take their toll too.
• Empty months between tenants and the cost of finding the next one. Letting and contract fees can’t be charged to the tenant.
• Buying costs. Purchase taxes, notary and Land Registry fees. They aren’t an annual cost, but they add to what you’ve invested. They’re covered in NIE, notary and taxes in Spain.

A worked example (hypothetical figures)

The figures in this example are made up to show how the sum works. Use your own.

An 80 m² flat in Albir bought for €380,000, with €38,000 in buying taxes and fees. You let it for €1,300 a month.

If the owner lives in the UK, they pay 24% on the €15,600 rent with no deductions: €3,744. That leaves €7,606, a net yield after tax of 1.8%. An owner living in Sweden, Denmark, Norway or elsewhere in the EU or EEA pays 19% and can deduct allowable costs first, so they keep more.

Tax: if you live in Spain or abroad

If you’re tax resident in Spain

Rental income goes on your Spanish income tax return (IRPF). You deduct allowable costs (IBI, community fees, insurance, repairs, mortgage interest, depreciation and so on) and a reduction is applied to the net income left. Which one you get depends on when the tenancy was signed:

• Tenancies signed before 26 May 2023: a 60% reduction.
• Tenancies signed between 26 May 2023 and 1 December 2026: the Housing Act rule. 50% as standard; 60% if you renovated the home in the previous two years; 70% if you let to a public body or non-profit for social housing. The 90% rate, and the 70% rate for young tenants, require the home to be in a «stressed» housing market area, and none has been declared in the Valencia region.
• Tenancies signed from 1 December 2026: the new scale in the October decree-law. On a first let, the reduction is 100% if the rent is below the Ministry’s reference index, 85% if the tenant is aged 18 to 35, and 50% otherwise. If you’re replacing an earlier tenancy, it depends on whether the rent goes down, stays the same or goes up: 70% to 100% if you cut it by more than 5%, 50% if it stays the same, and 15% to 40% if you raise it. Large-scale landlords (more than ten homes) are excluded from this scale.

Note: this new scale comes from a decree-law in force since 8 October 2026 that Congress still has to validate. On 2 October Congress threw out an earlier decree with similar measures. If this one falls too, the Housing Act rule stays in place.

If you’re a non-resident

You declare rental income on form 210 for non-resident income tax:

• Residents of the EU, Iceland, Norway or Liechtenstein: 19% on the rent minus the allowable costs you can prove.
• Everyone else, including UK residents: 24% on the gross rent, with no deductions.
• The 50% (and higher) reductions belong to the residents’ income tax, so they don’t apply to non-residents.
• For rent received from October 2026 onwards, form 210 is filed between 1 and 20 April of the following year.

If the property sits empty for part of the year, as a non-resident you also declare imputed income for those days. And if you might sell later, it’s worth knowing about capital gains tax for non-residents.

The tenancy: length, notice and rent rises

• Length: the tenant has the right to stay at least five years, or seven if the landlord is a company. After that, unless someone gives notice (you four months ahead, the tenant two), it rolls over year by year for up to three more years.
• Tenant leaving: they can leave after six months by giving 30 days’ notice.
• Rent rises: since 8 October, rent can only be reviewed if the tenancy agreement expressly says so, and never above the official rent-review index (IRAV). On top of that, until 31 December 2027, if the rent is above the Ministry’s reference index it can’t go up at all. If it isn’t, it goes up by whatever you newly agree, or 2% at most without agreement.
• Extraordinary extension: if the mandatory term ends before 31 December 2028 and the tenant is up to date with the rent, they can ask for up to two more years on the same terms, with exceptions such as you needing the home for yourself or your family.
• Stressed areas: caps on rent for new tenancies only apply in declared stressed areas. There are none in the Valencia region, so they don’t affect Alfaz del Pi or Albir.

The rent-rise limits and the extraordinary extension also depend on the decree-law being validated. Check the rules are unchanged before you sign.

To get to know the area better, here’s how we work in Alfaz del Pi and in Albir.

Frequently asked questions