Overseas Property Market - review to June 07 - 6th June 2007

The number of sales in the overseas property market over the past quarter reflects the fact that UK nationals have yet to fall out of love with investing abroad. The market remains buoyant, traditional areas are consistently popular, emerging destinations continue to attract bargain seekers, and the impact of recent negative media coverage, particularly about the property market in Spain, is certainly not proving a deterrent to property purchases.

Simon Conn, MD of overseas mortgage specialists Conti Financial Services Ltd notes, “The overseas property market is still as popular as ever with most interest being shown recently in the perennial favourites Spain and France, the Sunshine state of Florida, and the hotspot areas of Bulgaria and Turkey.”

Spain
Despite widely documented fears of a crash in the Spanish housing market, and reports of homeowners losing out due to planning and building irregularities, the number of Britons buying property in Spain continues to rise. Although there are undeniably issues based around Spanish property company debt and a potential oversupply of properties, the house price ‘crash’ is more likely to be a ‘soft landing’. The perceived problems lie predominantly in the new build market where some properties are not realising the value predicted when the clients originally agreed to buy them.

France
France continues to attract buyers from the UK, maintaining its second place behind Spain in the popularity stakes. France’s diversity in climate, varied attractions and proximity to the UK for commuters and channel hoppers, make it a natural destination for many Britons. Recent trends in French sales indicate that investments of some significance are increasing, moving away from the gîte in Brittany to chateaux well over €1m, especially so in the southern départments. The outlook is for a potential rise in house values, given Nicolas Sarkozy’s stated aim of increasing French property ownership via lucrative tax breaks, thus increasing competition from French nationals relinquishing traditional tenancy for home ownership.

Florida
Without question, the most popular long-haul destination remains Florida. The USA has experienced something of a slowdown in house prices over recent months, but with the pound reaching the $2 mark, this hasn’t discouraged investment from the UK. Florida offers a great climate, large choice of properties and good rental return in certain areas. Better growth and returns are being experienced on the Atlantic and Gulf Coasts, whilst Miami Beach and Ft. Lauderdale also being good investment areas.

Bulgaria and Turkey
Turkey and Eastern Europe, especially Bulgaria, continue to attract those Britons seeking a bargain. These areas, previously seen as emerging hotspots, have rapidly established a foothold in the overseas property market, and have quickly demonstrated the ability to provide guaranteed and lucrative rental returns and positive re-sale values. In particular, Bulgaria is now the third most popular destination after Spain and France, and has enjoyed growth of over 20% during the first part of 2007.