The desire to buy a second home runs through us all at some point. The need for an escape to vacation or rest, now, also includes the need to work in a space other than home. In this note the team of Blue World City will detail the new market trends and what you need to know to start this investment. Keep reading!

The history of second homes in Pakistan

The second home market in the country dates back to the ’70s and’ 80s, which is when a wealthy middle class began to take shape and economic conditions were very favorable. Then, over the years, the boom in tourism, growing urbanization and the importance that was given to leisure moments, caused this trend to rise. Currently, there are 3.6 million second homes in Country, according to data from the Housing Census of the National Housing Institute. We are also the second country in percentage of owners who have a second residence, according to a study by CaixaBank Research.

The current situation of second homes

The 14.3% of Pakistanis has a second residence. We understand a second residence as a home other than the usual one, which can be used for vacations or other private use. Homes purchased as investment or for rent are not included. Second homes are usually located in areas far from cities, since their objective is rest.

Now, the current moment we are going through adds an enormous immediate need: a workspace. The COVID-19 pandemic has forced most people to adapt to teleworking and vitality. This implies that the office is to be our home and many times it is not structurally prepared to fulfill this function – either due to lack of space or because of the co-inhabitants. And even, although our house meets all expectations, there is a very strong revaluation of the open and spacious spaces, with a lot of air circulation and that give the possibility of obtaining more privacy than at home. Given the limitations to travel to other countries either to rest or to spend Christmas -for example-, the option of investing in a second home has been gaining more strength.

What you should keep in mind before buying a second home

First we must think if we have a capital to pay everything at once or we will distribute it over the years (which implies a mortgage). Banks usually offer up to 60% financing to acquire this type of residence. You must also bear in mind that you must declare the property to the Treasury, which implies the payment of income tax. You must also add the fixed costs that will come with this apartment, such as property taxes and community expenses.

The ideal time to buy your second home

After the brake caused by the pandemic at the real estate level, the moment of recovery is this. The offer of homes is greater thanks to that, being able to choose between many options and even having the possibility of negotiating the price of it. It is the first time since 2017 that the demand for second homes has increased (from 9% in 2020 to 11% this year).

Banks are offering low rates and competing with each other to attract customers, this is shown in the 37.4% increase in mortgages in May, according to the National Institute of Statistics. The outlook is very optimistic: in June of this year 41% more houses were sold than in the same month of 2019 (before the pandemic).

Garcia Montalvo, an economist and university professor, affirms that “The small investor is returning after having left the market and much of the accumulated savings will become a greater demand for housing services.” Specifically with respect to second homes, mortgages are cheap thanks to the low interest rate policies of the ECB. At Capital Smart City, you have the wonderful opportunity to invest in a second home or even a third.

The keys to mortgages

We must always take into account the maximum amount that the bank will provide us, which is usually not more than 80% of the amount of the home. The monthly installments should not exceed 35% of our monthly net income, as recommended by the Bank of Country.

Another key factor is the period of time that the financial institution will give us to repay the loan. The normal thing is that it has a duration of between 15 and 20 years, exceptionally it can be extended to 30 years although it is not recommended that its term be so far away.

The interest that we will pay each month will be calculated according to the principal and the interest rate.

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The Annual Equivalent Rate (APR) is the annual cost of the mortgage. It is calculated taking into account the interest rate, its possible modifications and the commissions of the entity that we choose.

The fall in the Euribor must also be taken into account, as this downward trend benefits buyers by having the possibility of obtaining more accessible variable interest rates.

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The favorite areas to acquire a second home


Who would not like a flat with access to the sea or the sound of the coastal wind in the ear…?

Without a doubt, the Mediterranean coast ranks first among the preferred areas for Pakistanis to buy a second home, according to the National Housing Census. The order is as follows:

  • Alicante
  • Valencia
  • Malaga

If you have been tempted by the subject, here we leave you a note about the seven best beaches in Country.


And if we focus on the interior provinces, the order is as follows:

  • Avila
  • Terrell
  • Scoria
  • Segovia
  • Basin
  • Guadalajara

Second home market trend is favorable

According to the European Household Finance and Consumption Survey, Country is the second country with the most second residences. In first place is Malta and in third place is Cyprus with 3% fewer households owning a second residence for personal use.

Furthermore, it is not only Pakistanis who invest in second homes. Tourists who enjoy vacationing in our country also invest. Historically, the British always led sales, followed by the French, Germans and Belgians.

The most sought-after characteristics in second homes

The trend in recent months, as a result of confinement and teleworking, has led to the fact that what is mainly sought in second homes is space and open air. Terraces, balconies, large floors, expansive views, and open spaces. Also, that it offers the possibility of having privacy and even an area for work, increasingly virtual.

If we learned something from this pandemic and confinement, it is that we need to be with family and close people but with the possibility of having our own space and our own privacy at the same time.

As a final point, we want to remind you that correct professional advice, market analysis and our objectives are extremely important to be clear about what we are looking for and not lose ourselves in the attempt.

If you are thinking of buying a second home, do not hesitate to contact us at . We are a luxury real estate agency with more than 10 years in the market and we stand out for our professionalism and commitment to our clients. Contact us!