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Overseas property ownership jumps 45%

Over the last two years the number of overseas property owners has increased by a staggering 45%, with 250,000 more households now owning an overseas property than in June 2004...

As the nights draw in and the Summer of 2006 becomes a distant memory, latest research from MINTEL finds around 800,000 British households (3%) now enjoy the benefits of owning a second residence abroad. Over the last two years the number of overseas property owners has increased by a staggering 45%, with 250,000 more households now owning an overseas property than in June 2004.

What is more, a further 3% of households intend to buy a second property overseas in the future and 5% intend to sell up here and move abroad. This suggests that potentially the dream of owning a property abroad could be a reality for a further 2 million households.  Meanwhile, many people see the Lottery as their only means of escape, with as many as one in five (22%) or 5.5 million households planning to buy a foreign property if their ship comes in.

"With home-ownership in the UK booming it is fitting that British citizens are now looking to export their undoubted passion for housing," commented Paul Davies, senior finance analyst at MINTEL.  "Indeed, the last few years have seen a significant increase in the level of interest shown in the overseas property market, as the concept of owning a second residence abroad has become an achievable ambition for an increasing proportion of the population."

Davies continued, "The UK property boom, has increased levels of housing equity and has given many people the opportunity to purchase their dream home in the sun.  Meanwhile, the low interest rate environment has allowed other prospective property purchasers to take advantage of relatively cheap borrowing."  He added, "Interest in overseas property has also been stimulated by the amount of coverage the issue has received across the media, together with the boom in low cost airlines."

A place in the sun

For those who own, would like to own or have use of a property abroad the most commonly mentioned reason for choosing a home overseas is to provide easy access to sunnier climes (51%).  The prospect of making money abroad proves almost as attractive, with as many as four in ten (40%) looking at an overseas property as an investment, while a similar proportion (38%) would like somewhere to spend time during their retirement and somewhere to take their children or family.

"The UK has witnessed a buoyant buy-to-let market in recent years and the surge in house prices has made it increasingly difficult for investors to find suitable places at home where they can reap sizeable returns. As a consequence, some investors are now looking further afield in order to identify properties that have the potential to yield reasonable profits," explains Paul Davies.

Meanwhile, for some life in Britain is proving far less appealing than life abroad, with almost a quarter (23%) saying that a key reason for their interest in buying a property abroad is that they are sick of this country.

Viva España!

Amongst those who own, would like to own or have use of a property abroad, Spain proves the most popular destination, with as many as two in five (43%) choosing Spain as a preferred location for a property abroad. The next most popular destination is France, attracting 26% of people, followed by Australia (22%), Italy (21%) and the US (17%).  By contrast, only one in 15 (7%) chose Eastern Europe as a preferred location.

"The research does suggest that the British property buying public still largely need to be convinced about the appeal of newly accessible Eastern European countries," comments Paul Davies.

A case for regulation?

When it comes to buying abroad, a major concern for the majority of all British adults is a fear of losing their money.  Indeed, more than six out of every ten (61%) adults would worry about being ripped off, if they were to buy a home abroad.   What is more, over four in ten (41%) adults would be happier buying property abroad if the process was regulated by the EU.

"It would seem that a significant proportion of the population would feel safer if the foreign property market was regulated. The research does therefore suggest that the introduction of statutory measures by the EU could have a positive impact upon the overseas property market," concludes Paul Davies.