New Hope For UK Investment In Spanish Property
Despite the latest uncertainty over Brexit, British buyers still make up the single largest group of consumers in the Spanish property market. In its latest published figures a leading real estate agency portal reports UK investors as representing almost 24% of all site visitors, compared with a total of just under 60% from the rest of Europe and 16.4% from the rest of the world. The impact of Britain’s decision to leave the European Union in the referendum, held almost three years ago, is singularly difficult to gauge as confusion continues to reign in the UK and the ripples of doubt have spread to global markets.
Foreign exchange rates have undoubtedly been affected by political decisions and this has had the potential to be disastrous for sterling. The pound, however, after suffering its lowest exchange rate against the Euro in June, 2016 at 1.02€ to £1, has today bounced back to somewhere in the region of 1.15€ to £1. This is encouraging news for UK buyers as it restores confidence in the affordability and potential of overseas investment.
Despite all the twists and turns in its relationship with its number one customer, however, Spanish real estate has managed to adapt and diversify resulting in healthy growth and higher levels of international interest. The last three months have shown Germany, France and the Netherlands as frontrunners in European, Spanish property enquiries, followed by Belgium, Sweden, Italy, Ireland, Norway, Switzerland and Denmark. It is also interesting to note that enquiries from Portugal, not traditionally a major investing nation in Spanish property, rose by almost 60% during the same period – a staggering increase in such a short time period.
This new demand has caused a continued escalation in property values. Ibiza, for example, has seen an increase in prices of 2.7% in the last year and has reached an average property value of 1.2 million euros. The island has an abundance of 1 million euro plus properties for sale with the demographics of investors being younger than in other Spanish regions.
Certainly for the British it looks like the time to buy Spanish property is now because the Brexit deadline has been extended until 31 October. Following that, who knows what will happen?
UK investors are still eager to take advantage of Brexit-sensitive ideas and recalibrate their portfolio before uncertainty resumes. House prices in Spain show no prospect of a decline and have continued in a stable, upward trend since the end of the financial crisis. There is also a new urgency caused by fresh competition from global sources which will, no doubt, provide the incentive for UK buyers to reinforce their position at the forefront of investment and, ultimately, determine Britain to maintain its position as the top nation of foreign home owners in Spain.
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