Old favourites France and Spain still overwhelmingly popular
It appears that more and more of us are seeking a little slice of life overseas, with Conti, the overseas mortgage specialist, experiencing a 62 per cent surge in mortgage enquiries during August, its busiest month so far this year.
And despite ongoing uncertainty in the eurozone, it’s still the old favourites which top the list of overseas property hotspots. France is still top choice for prospective buyers, accounting for 43 per cent of enquiries received so far this year, followed by Spain with 36 per cent. But the gap is narrowing – France is down by two per cent since this time last year while Spain is three per cent up. Spain, in fact, accounted for more enquiries than France during the months of May, June and July.
In addition, there’s been a resurgence in interest about Turkey which has moved back up into third position, accounting for 10 per cent of enquiries, up from six per cent last year.
Clare Nessling, director at Conti, says: “Traditionally, our enquiry levels tend rise around now, as people return home from trips abroad with dreams of owning their own place in the sun. But the uplift is even higher this year, perhaps the result of the UK’s hottest, driest and sunniest summer in the UK since 2006 inspiring even more people to invest in an overseas bolthole which they can escape to during the cold winter months.”
Top Five Hot Spot Destinations
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Source: enquiries received by Conti so far in 2013 compared with same period in 2012 and 2011 Clare Nessling continues: “Prospective buyers are still playing it safe when it comes to location, with France and Spain still out on their own in terms of popularity. And there may actually never be a better time to buy – bargain property prices, historically low mortgage rates, good rental yields and a stronger pound are all making it more affordable for British buyers right now.”
Vive la France
When it comes to a sound overseas property investment, it could be said that France provides all the fundamentals. Borrowing costs have tumbled over recent months, and at the moment, mortgage rates are at their lowest in more than 60 years. Affordability has also been boosted by a slower property market which has been pushing prices down. And there’s the enduring appeal of easy access from the UK, better weather, and good rental yields. France also represents relative stability amid the global downturn. Mortgage rates currently start from just 2.1 per cent and you can generally borrow up to 80 per cent of the value of the property.
Spain ticking all the boxes
Buyers in Spain are in a strong position due to the number of homes available and the possibility of negotiating prices down with some very motivated vendors. With banks such as UBS predicting that prices still have another 8 per cent to go before bottoming out, buyers are taking the opportunity to snap up bargains while they can. It also helps that the country offers cheap and easy access from the UK, and rental opportunities are good too. Unsurprisingly, mortgage availability isn’t as good as it was a few years ago, but there are still lots of opportunities, especially if you have a healthy deposit to put down, and you can generally borrow up to 65 per cent of the value of the property. Rates currently start from just 3.23 per cent.
Turkey offers all the benefits of its Mediterranean location, minus the effects of the eurozone crisis, which has pushed some prospective investors to locations outside the traditional European property hot spots. Tourism has risen dramatically over the last few years, which will ensure that demand for quality rental properties in the popular tourist areas will continue to outstrip supply, making rental yields very lucrative. It’s also growing in popularity as a retirement destination, with many being lured by the warmer climate, lower costs of living, and excellent property value. For many, it’s simply a more cost effective location at the moment and certainly seems to be on an upward trajectory.
Conti is the UK’s leading overseas mortgage specialist, providing finance for purchasing holiday homes, investment and retirement properties in numerous countries across the globe. All mortgage applications are processed and underwritten by Conti’s team of specialists, who know the exact requirements for each overseas lender. It can also ensure that clients are put in touch with specialists in the country in question, to enable them to comply fully with planning and legal conditions and assist with currency exchange.