Attracted by the prospect of their own place in the sun and an easy way of making money, the numbers of British people owning a second home abroad is booming as never before.
Around 800,000 British households now own a second home abroad, up 45 per cent since June 2004, according to research published yesterday.
The boom has been fuelled by television programmes about people buying abroad and assisted by the rise in property values in Britain, low interest rates and the availability of cheap no-frills flights.
The trend is expected to continue, according to Mintel's Market for Homes and Properties Abroad, which says that another 3 per cent of British households are planning a second property abroad, while a further 5 per cent are planning to sell up altogether and move overseas.
A better climate remains the main reason, with more than half of the nearly 2,000 people questioned giving that as their principal reason. However, an increasing number are seeking to invest in new-builds, with 40 per cent of respondents saying that making money was their prime motivation, while 38 per cent wanted a future retirement property and somewhere to take their families.
Paul Davies, a senior financial analyst with Mintel, said: "The property boom has increased levels of housing equity while the low interest rate environment has allowed other prospective property purchasers to take advantage of relatively cheap borrowing.''
Overall, Spain remains the most popular destination for living abroad, with 43 per cent naming it as their preferred location; next is France, followed by Australia and Italy.
Despite the increased interest in eastern European countries, they still remain a target for a minority, with only 7 per cent choosing such destinations. However, companies such as Bulgarian Dreams, which is based in London and specialises in new developments, stressed that their business was booming. David Smith, the general manager, said business was increasing by 50 to 60 per cent a year.
People liked Bulgaria, he said, because it was a short flight from London, enjoyed a Mediterranean-style climate in summer as well as skiing in the winter, had safe swimming in the Black Sea and boasted the cheapest property prices in Europe. Additionally, it would benefit from joining the EU next year, with low-cost airlines expected to expand routes.
Among his clients are Phil and Hilary Barker from Lancashire, who are paying £73,000 for a two-bedroom apartment on the Black Sea coast as an investment and holiday home.
They plan to visit during school holidays with their children, aged 13 and 10, and rent it out the rest of the year, hopefully making a profit. Mr Barker, 40, said: "I think an investment there is a safe option.''
Marjorie Mansfield, of Siddalls, financial advisers specialising in French and Spanish property purchases, said many of the latest wave of buyers plunged in without considering the consequences after watching television programmes. "Generally, it tends to work better if you want a holiday home rather than an investment, because a lot of people don't realise that tax and inheritance laws are different," she said, adding that ownership rights can also be "problematic".
The Mintel report said almost a quarter of those surveyed were buying abroad because they were sick of Britain.
Top choices
1 Spain
2 France
3 Australia
4 Italy
5 US
6 Portugal
7 New Zealand
8 Cyprus
9= Greek Islands
=Caribbean
=Canada
=Majorca/Ibiza
10 Canary Islands
Source: Mintel.
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