It is the thing that many people dream about, owning their own second property on the continent that they can escape to when they wish. There are many stunning locations throughout Europe and all bring something different to the table when you are looking at that perfect holiday home abroad, however it is important that all aspects are considered before taking the plunge and you should be comfortable that you will be able to afford the property.
For many, now is a good time financially to invest in another property. The British economy is vastly improved on a few years ago, pay rises are starting to come back and there is certainly more disposable income in people’s pockets. This also comes at a time where buying a second property in the United Kingdom is not particularly appetising, with sky high prices, poor mortgages and a lack of return available on a lot of properties. The story is different in many parts of Europe though, with the recession and economic hardships rocking the Eurozone for a much greater period of time than it did the United Kingdom. This means that British citizens are able to benefit their pocket and find their dream second home in Europe, with the possibility of even being able to make some money from their investment.
So why is Europe now such a good place to buy a property and why should Brits look further away from home for their investment?
As most people will be aware, the Euro is a struggling currency at this moment in time, particularly due to the Greek economic crisis and the ever lower hanging cloud about the stability of Greece in particular. With the country nearly defaulting on loans and needing bailouts from the rest of the Eurozone, faith in the currency has dwindled throughout 2015 and it now trades at €1.37 to £1 – rates that have not been seen for almost a decade. Considering that it was within the last 18 months that there was near parity between the Euro and Sterling, this is something of a fall from grace for the Euro but the bright side of this for the British is it make Europe a good 10% cheaper than it was one year ago.
The above means that this period of time is a cheap time to purchase property, even if the asking price of properties are increasing – you may actually be paying less now for a more expensive property then you would have a year ago when the same property was cheaper.
As alluded to briefly, many parts of Europe are starting to see their property prices increase, however these increases are nowhere near the rate the United Kingdom is seeing. In fact many locations in Europe have not yet reached their pre financial crisis levels, whereas these are now being exceeded in the UK. Spain, in particular, is a good place to find a bargain dream property as their economy is still not fully recovering and their house prices have only just started to rise again meaning there are still a lot of gems to be found.
If you are looking to see a bit of a return on your investment, generally your best bet is to use your property as a holiday let. This gives you the freedom to use the property when you wish, but it also means that you can gain some income when you are not using the house. Because of some of the reasons above, tourism in Europe is growing again – especially when you are talking about British citizens visiting Spain and France. The weak Euro currency means that there is more money in people’s pockets and the falling price of oil has seen flight prices fall – and they are expected to fall further. All of these means that the demand for properties to stay in for tourists is reaching record levels and that’s good for your bank balance.
Article provided by Mike James, an independent content writer in the property industry – working alongside a selection of companies including Marbella’s largest and longest running real estate agent Panorama.es, who were consulted over the information in this piece.