06th November 2006

Spain's top three offer great deals for bargain hunters

Sonia Purnell puts together a portfolio of rising areas for the discerning property buyer

1 Cadiz Province

West of Gibraltar, the Mediterranean gives way to the breezy Atlantic, crashing against the Costa de la Luz in south-west Spain. Relatively undeveloped, it is fast becoming chic. While windsurfers flock to Tarifa, those seeking a genuine Andalucian experience enjoy the rakish charms of the coastal city of Cadiz and the grand, rolling interior.

Palace views: The Alhambra, Granada, in southern Spain - one of the areas where international estate agents have been slow to move

Until recently poor transport links left it relatively cut off, but it has now been turned into a holiday home destination by budget flights to Jerez and the high-speed AVE train link from Madrid. Better roads also mean easy access to the coast, with Jerez - where an apartment in the historic city centre costs 250,000 euros (£160,000) - now just 20 minutes from the white-sand playas.

Medina Sedonia and Arcos de la Frontera, blessed by fine lakes, are popular. Farmhouses near Arcos, a pre-Roman town hanging over a dramatic gorge, go for £235,000.

"In the past Cadiz province could never compete with the Costa del Sol on accessibility," says Barbara Wood of Property Finders, who is now advising many Brits on buying in the area. "But the last couple of years have changed all that. Many well-off Spaniards buy here, so there's still a lot of price growth to come."

2 Majorca

With the world's rich, famous and royal flocking to Majorca for their summer holidays, buying property on the island has become prohibitively expensive for most of us. "There is no undiscovered village that has not been restored and sold for a fortune," says one agent. But those with their ears to the ground point to two areas that have not yet had the star treatment.

"The east has a quiet, rural feel. It's the last unspoilt part of Majorca," says Michael Cunningham of MJC Associates. "Poor communications until recently made it cheaper. That is changing fast with better roads, but the price of a nice finca with land and views, 20 minutes from a gorgeous cove, is still half that in the overcooked south west."

Bargain-hunters are heading north from Porto Colom, which has future potential with a largely undeveloped harbour, to Porto Cristo, past some 20 mostly unspoilt coves.

Meanwhile, Soller, the one-time shabby port in the north-west, is also relatively cheap. But an extensive revamp, including the demolition of ugly military buildings and a new tunnel to take away the traffic, is attracting interest. The gin-palace yachts now berth in the newly expanded marina.

"The plastic café chairs have gone, the chic white shades are up, Soller is changing overnight," says Jan Westwood. "So you will have to move quickly if you want a bargain."

3 Tenerife

Cheap as chips, dressed in high-rise hotels and tattoos, Tenerife has long suffered from an image problem. But four years ago, the government of the largest Canary island launched a rebranding exercise, aiming to lure the more discerning visitor by banning anything other than top-end development and planting a lot of new trees.

Many Brits have also been seduced by prices that are substantially lower than those on the mainland and the possibility of year-round rental return, thanks to the winter sun.

The new, more upmarket developments such as Amarilla Golf - where properties with fewer than two bedrooms are banned - are selling well and resales have seen sharp price increases. Property prices in the new, smarter areas, including Fanabe and San Blas, have risen by 18 per cent over the past year, while there has been almost no increase in the old Tenerife fleshpots of Las Americas and Los Cristianos.

"Tenerife had the highest number of tourists in July this year since the heyday of 1973, so the move upmarket is definitely working," says Leslie Beeson of Tenerife Property Shop. "It is an island with the best climate in Europe that now appeals to the toff end of the market."