France and Spain are still the top locations for British property buyers seeking a second home abroad despite the eurozone economic turmoil.
However, the eurozone crisis has boosted interest in other destinations, in particular Australia, New Zealand and the United States, data from currency specialists HiFX reveals.
A quarter of Brits believe that it is cheaper to own and run a property abroad than in the UK, the company's Property Hotspots Report also found.
France tops the list, with over a third, 35%, of buyers looking to own a property across the Channel, followed by Spain with 16%, both way ahead of the US at 8%. After that comes Australia and New Zealand, both at 6% and Germany and Italy, both at 4%.
'France remains a safe bet for Brits. It goes without saying that the sun and lifestyle are a big pull but buyers are now also able to get better value for their money and take advantage of the weakening euro,' said Mark Bodega, director at HiFX.
'Spain continues to attract Brits who are hoping to take advantage of depressed property prices. The average property price in the country is down almost 30% since the market peaked in 2007, yet while there are discounts to be had buyers need to pick carefully. The macroeconomic outlook remains poor, and because of this, we are unlikely to see any further stabilisation in the current housing market,' explained Bodega.
'Buyers should remember that Spain is in a precarious position, not so much due to the weight of her sovereign debt compared to GDP, but due to the high levels of private debt and an extremely weak housing market. Prime Minister Mariano Rajoy's recent very austere budget will only result in further strikes and unrest which could well lead Spain deeper into a self fulfilling downward spiral,' he warned.
And he pointed out that whilst prices are cheap in Spain, potential property owners should be warned that further depreciation in property is still likely and will affect any future returns.
'The recent gains made by the Pound against the Euro can be felt throughout Europe but Spain and Portugal have also seen costs and prices fall for a variety of goods and commodities unlike other parts of the Eurozone, notably Italy. We advise buyers looking to pick up a bargain in these countries to do their research and take on board the risk of buying in economically uncertain times before making any important decisions,' said Bodega.
However, the report shows that capital growth is not at the forefront of people's minds when buying abroad and that the core appeal of continental Europe hasn't changed as Brits remain attracted to the popular formula of sun, sea, sand and sangria.
The research found that three quarters, 74%, of Brits rated lifestyle as the most appealing factor, closely followed by the weather at 66% and only 6% of Brits were looking to obtain solid rental returns.
The report also revealed that whilst some buyers are keen to stick with what they know, recent events in the eurozone have in fact boosted the appeal of property hotspots further a field. Brits are now setting their sights on other English speaking countries including the US, Australia and New Zealand as their ideal destination.
'Brits are turning their attention across the pond as signs of US recovery are beginning to become more apparent. There are bargains to be had but Brits looking to buy a US property as an investment need to focus on areas where the rental demand is strong and where taxation on property is low,' added Bodega.
SOURCE Propertywire
