We regularly get questions about the possibility of starting a B&B abroad. However, starting a tourist activity in Spain or Portugal is no mean feat. Rather, it is a long-term job. This article offers you four general tips to start your search for a suitable property.
Tip 1. Make a selection of willing municipalities
In Spain, the licensing situation depends heavily on the autonomous region. For example, in the Comunidad Valenciana and the autonomous region of Catalonia, there are stricter rules for a casa rural than in Murcia or Andalusia. Spain also looks at the extent to which there are pre-existing hotels and B&Bs. In Portugal, by contrast, there are several levels of planning: the national level; the regional level, the intermunicipal level and municipal plans.
For a regular B&B, the municipal level will mainly matter in both countries. As a rule, you will therefore first need permission from the municipality to start a B&B, glamping, tiny houses concept, mobile home pitches or a similar tourist activity. It is then advisable to know in advance in which municipalities you will find it easier to obtain a permit for your idea.
So the first tip is to check with local municipalities about the feasibility of your plans. You can do this, for example, with the help of a local architect who knows his way around municipal politics.
Tip 2. Check the property
Once you have consulted several municipalities about your plans, you will already have a better idea of what is or is not possible. Within your selection of municipalities, you can search specifically for a suitable property.
However, what do we mean by suitable premises? On the one hand, there should be sufficient space to carry out the activity. Think of number of rooms, sanitary facilities, sufficient land etc. Also, the location should be sufficiently commercial. On the other hand, you need to be sure that you are allowed to start a commercial activity from a legal point of view.
Such a property is not cheap. Often, potential buyers make the mistake of purchasing a property in agricultural areas. After all, in inland areas, you can buy large plots of land for relatively little money. However, the opportunities to start something up here are limited.
Therefore, the second tip is to have due diligence/legal checks carried out on the property. It is appropriate to commit to purchase only when you are certain that the property is in order from a legal point of view. Know that a local notary will not assist you with this.
Tip 3: Prepare a financial plan
Besides the purchase of the property itself, other investments will undoubtedly be needed. For the property itself, there are various options for financing depending on your situation. For example, consider a Spanish mortgage or (re)taking out a loan in Belgium.
However, if the B&B becomes your main activity and you cannot rely on other income, the bank will impose certain conditions in terms of repayment capacity. In this case, it is recommended that you draw up a detailed financial plan to convince the bank that your business is financially viable.
Incidentally, it is advisable to have sufficient funds to live for two years.
Tip 4: Consider the administrative and tax obligations of a B&B abroad
As a B&B operator, you will also have to comply with the obligations of a business. Think about registering your self-employment, paying VAT, being affiliated to social security, paying local taxes, keeping accounts, etc. If you offer food, you will also need a food licence. It is best to map out the rules applicable to you in advance.
Conclusion: reflect before you begin
With this article, we want to show that starting a B&B abroad is not easy. Starting up a professional tourism business - this is a business you will have to make a living from - involves several commercial, legal and financial decisions. Good preparation is therefore a must.
Do you have questions about starting a commercial activity in Spain or Portugal? If so, please feel free to contact on.