Think of buying in Spain and you invariably conjure up images of hillside fincas or coastal villas - but if you want a truly stylish home and a shrewd investment, look to Barcelona.
Spain's second city is now one of the most fashionable places to live, its estate agency sector is beginning to target British buyers, and developers are producing some distinctive homes.
Probably the most chic is Paseo de Gracia 99 in the midst of the city-centre café area, close to the Placa de Catalunya landmark and surrounded with architectural gems by Antonio Gaudi. Gracia 99 has just been renovated, with Catalonian interior designer Carlos Ferrater providing marble and wood surfaces throughout, and sliding glass doors in most rooms.
There is a concierge service and parking (a scarcity in the city) and the 69-unit development is being marketed internationally to attract a wide range of buyers - although only if they can meet the hefty tag of £510,000 to £1.25m for each apartment, on sale through UK agency Savills.
Not everywhere in the city centre is that expensive. Diagonal Mar, a hitherto depressed central area that missed out on the regeneration for the 1992 Olympics, is now being transformed, and a large, three-bedroom apartment in a modernised 1950s block is on sale for £205,000 on www.homesearchbarcelona.com.
The block sits near five newer towers where some off-plan purchasers in 2002 have sold apartments at a 50 per cent profit. Flats in this suburb fetch £900 per square metre - a fraction of the £3,750psm reached in one of the most expensive areas of the city centre, Eixample, where Gaudi's Sagrada Familia is located.
The Royal Institution of Chartered Surveyors, which looks at the Spanish property market each spring, says the country's boom is now the longest-running and largest in Europe and is led by a shortage of supply in urban areas compared with the demand from buyers. It says that although there can be no long-term continuation of the 20-per-cent-plus annual price rises seen from 2000 to 2003, and the 15 per cent seen last year, there remains no likelihood of a crash.
Anyone buying a second home in Barcelona is likely to be able to rent it out with little difficulty. Until recently, this was rare; most Spanish owners left their property empty if they did not use it. But in 2002 Catalonia's regional government gave tax incentives to landlords and the rental sector has blossomed.
"Buying to let in a Mediterranean city like Barcelona is interesting because of the mix of tourism, international business and conventions," says Rita Fryer, of the buying agency Property Finders. "It offers an ideal combination of good annual rental return, capital growth, and an easy exit."
She says a small apartment can attract 150 to 200 euros (£100 to £135) per night if a landlord wants very short-term tenancies (and can therefore use the property himself between tenants) or an average of 100 euros (£67) a night if a long-term professional tenant is secured. Good management agencies are easy to find in the city, she says.
A Barcelona buy-to-let can, in theory, attract business for the entire year, unlike a property in, say, a coastal or mountain location where the holiday season will be much shorter.
The demographics make Barcelona a shrewd place to invest, even after the price rises that flats and houses have already enjoyed. It is a booming city of 1.75 million people, including a skilled, affluent pool of renters occupying over 15 per cent of the property stock. The city and surrounding area has about 16 per cent of Spain's population but attracts 25 per cent of its inward investment and generates over 20 per cent of its national product.
Last year saw the launch of the Barcelona Forum, a public/private initiative to generate 50,000 new jobs, regenerate derelict suburbs and build Europe's largest convention centre.
"While city-centre properties are expensive, there tends to be a greater pool of properties to choose from, excellent value can be found in non-central areas, and it's always possible to buy into an up-and-coming location," he says.
Savills 020 7409 8835; The Property Finders 00 34 97 262 4557; Stacks Relocation Spain 0871 871 4687; Homesearch Barcelona 00 34 93 409 3249.
Buying and renting in Barcelona
Barcelona properties have to be registered with a local council, so flats and houses on sale must have deeds and search documents, unlike some Spanish rural homes - this makes getting a mortgage easier.
If you do not already have a Euro bank account based in Spain, you will almost certainly have to use a British mortgage broker in order to identify a lender.
As well as purchase cost, you must pay a 7 per cent transfer tax, plus a registration fee of about £200, as well as notary and estate agency fees, but most of these costs are tax-deductible if you rent out the property.
Rental income gives a typical yield (proportion of purchase price recouped in rent each year) of 4.5 per cent after fees, according to property consultancy Homesearch Barcelona.