Old favourites still rule when buying a second home abroad

France and Spain are still popular but potential eurozone perils have boosted the appeal of Germany and Switzerland. Chiara Cavaglieri reports

Uncertainties in the eurozone may push property buyers in surprising directions, but the usual suspects are firm favourites for holiday homeowners, according to a new report. Exclusively for the Independent on Sunday, foreign exchange expert Caxton FX reveals the top 10 countries for holiday home ownership, with France and Spain taking top spots. if you're tempted to make one of these your second home, what do you need to know?

 

1 France

Unsurprisingly, France is the most popular destination for UK buyers who relish being able to pop across the Channel while still being close to home. France hasn't seen the dramatic house price decline of neighbouring Spain and finance is still available up to 85 per cent loan to value.

"France is still the most visited country in the world, and is unlikely to stop attracting international tourists, whether they are coming for the French Riviera, skiing in the Alps, for the scenery or for the culture and food," says Nicholas Leach, a director of French property specialists Athena Advisors. However, there are noises about bringing in extra tax on foreign property owners.

 

2 Spain

For the past 50 years we Brits have had a love affair with the Spanish costas and Balearic islands.

"A home from home for many, Spain's climate, infrastructure, ease of access from the UK, combined with good hospitals and healthcare system, political stability, timeless tourism appeal and affordable housing market draws buyers in their droves," says Marc Pritchard from housebuilder Taylor Wimpey España.

There is a huge oversupply of newbuild and off-plan properties, so there are big discounts up for grabs but remember to pick carefully. There are many horror stories of Brits who saw their homes bulldozed because cowboy builders and planning officials didn't obtain valid building licences. if countries like Spain were to leave the euro and return to a devalued national currency, foreign investors could come unstuck.

 

3 United States

Most British buyers in the US concentrate their efforts on Florida and some think prices here have bottomed out. The good news is that there are a few signs of recovery in the wider economy, including unemployment falling from 10.4 per cent to 8.3 per cent. Adam Cornwell from Florida-based agent Feltrim International says the big challenge will be the lack of finance but if you're a cash buyer, now could be the perfect time to snap up an American bargain.

"Europe is hardly a honeypot for property investment right now, leaving the US to emerge as a favourite once more, particularly given the prices," he says. In one of their resorts in Orlando two-bed apartments sold for $360,000 (£222,000) in 2009 but were moving for $89,900 by June 2011 and are still on sale for only $99,900 today.

 

4 Austrailia

buyers have been willing to venture further afield to find their dream holiday home, with Australia seeing a huge surge in popularity, marking a 67 per cent increase in purchases between 2010 and 2011. Tourist hotspots include Perth and the Gold Coast. Getting into the country could be the hardest step if you're wishing to emigrate down under, but if you want to buy a home you also need permission from the Foreign Investment Review Board. Property fees and taxes vary from state to state and remember if you spend more than six months in a year in Australia you will be liable for income tax.

But beware, many expats have been forced to return home because the cost of living has increased so much.

 

5 Italy

Many looking to own a second home in Italy will be repeat visitors who have fallen in love with the food, culture and climate of popular areas such as Tuscany, Campania and Sardinia. Economically, Italy is risky and foreign investors might have to take the hit. "Buyers interested in Italy haven't been reading the headlines; from an economic point of view the government is looking to tax as hard as they can," says Nigel Lewis.

If you're willing to take the risk, be prepared for a struggle as Italy has a reputation for awkward rules and regulations and many transactions fail to complete.

 

6 Germany

Germany may not be an obvious choice but, from an investment point of view, it is the powerhouse of Europe and many have turned to it for some stability within the eurozone. If you're planning to rent out, remember tenants have much stronger rights than in the UK.

 

7 Portugal

Portugal has many admirers and, although generally more expensive than Spain, Mr Lewis picks it every time. "Portugal is less developed and has more robust home ownership rules than Spain in terms of conveyancing procedures and land registry," he says.

 

8 Ireland

The property market is still in freefall with up to 60 per cent price reductions. The problem is the oversupply of property lying idle in unfinished developments. Until this is addressed prices will fall so it is difficult to pitch it as an investment prospect.

 

9 Switzerland

With low taxes and a steady property market that shouldn't be threatened by eurozone issues, Switzerland is a good option, but only for those who can afford it. Giles Gale from Mark Warner Property says: "The market is being supported by historically low borrowing costs with 10-year fixed-rate mortgages available at just 2.45 per cent." last week a referendum decided there will be a cap on the number of holiday homes.

 

10 Canada

With the Canadian dollar strong it's not the cheapest place to buy and there are residency restrictions and property purchase regulations. But, with so much to offer and a reliable economy, Canada is many experts' tip for the top.

Property checklist: Do your homework before the big move

1 Research the area Talk to locals and investigate the facilities/transport all year round.

 

2 Keep your UK property If you can, rent first to get an idea of what it's really like to live there.

 

3 Choose your developer with care If you are buying new-build, or off-plan, ask for client testimonials and get all the details in writing.

 

4 Check title rights Ensure that any developer or seller has the full title to the land or property.

 

5 Get independent legal advice Use an independent lawyer and surveyor who knows the country.

 

6 Understand the bureaucracy The overseas property industry is largely unregulated, so ensure you understand the homeowning red tape.

 

7 Correct financing Obtain an Agreement in Principle for your mortgage before signing contracts.

 

8 Research your tax liabilities Check the inheritance and capital gains tax laws, as well as taxes levied on purchasers.

 

9 Check local area rules Even within the same country there may be variations on property taxes, or restrictions on how long you can stay in your holiday home each year.

 

10 Consider currency issues Fluctuating rates can have a huge impact.

 

11 Banking Set up an account in your chosen country.

 

12 Pensions and healthcare Check that they are adequate for your current and future needs.

Discover more property articles at Homes and Property
Suggested Topics
Sport
Premier League Live
footballLIVE Follow all the Premier League action as it happens
Life and Style
3D printed bump keys can access almost any lock
gadgets + echSoftware needs photo of lock and not much more
News
i100
News
The slice of Prince Charles and Princess Diana's wedding cake and the original box from 29 July 1981
newsPiece of Charles and Diana's wedding cake sold at auction in US
PROMOTED VIDEO
News
i100Steve Carell selling chicken, Tina Fey selling saving accounts and Steve Colbert selling, um...
Voices
The Ukip leader has consistently refused to be drawn on where he would mount an attempt to secure a parliamentary seat
voicesNigel Farage: Those who predicted we would lose momentum heading into the 2015 election are going to have to think again
Arts and Entertainment
Cara Delevingne made her acting debut in Anna Karenina in 2012
film Cara Delevingne 'in talks' to star in Zoolander sequel
Sport
Mario Balotelli pictured in his Liverpool shirt for the first time
football
News
i100
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Clinical Negligence Solicitor

Highly Competitive Salary: Austen Lloyd: HAMPSHIRE MARKET TOWN - A highly attr...

Network Engineer (CCNP, CCNA, Linux, OSPF, BGP, Multicast, WAN)

£35000 per annum: Harrington Starr: Network Engineer (CCNP, CCNA, Linux, OSPF,...

Commercial Property Solicitor - Bristol

Highly Attractive Package: Austen Lloyd: A VERY HIGH QUALITY FIRM A high qual...

DevOps Engineer (Systems Administration, Linux, Shell, Bash)

£50000 per annum: Harrington Starr: DevOps Engineer (Systems Administration, L...

Day In a Page

Ukraine crisis: The phoney war is over as Russian troops and armour pour across the border

The phoney war is over

Russian troops and armour pour into Ukraine
Potatoes could be off the menu as crop pests threaten UK

Potatoes could be off the menu as crop pests threaten UK

The world’s entire food system is under attack - and Britain is most at risk, according to a new study
Gangnam smile: why the Chinese are flocking to South Korea to buy a new face

Gangnam smile: why the Chinese are flocking to South Korea to buy a new face

Seoul's plastic surgery industry is booming thanks to the popularity of the K-Pop look
From Mozart to Orson Welles: Creative geniuses who peaked too soon

Creative geniuses who peaked too soon

After the death of Sandy Wilson, 90, who wrote his only hit musical in his twenties, John Walsh wonders what it's like to peak too soon and go on to live a life more ordinary
Caught in the crossfire of a cyber Cold War

Caught in the crossfire of a cyber Cold War

Fears are mounting that Vladimir Putin has instructed hackers to target banks like JP Morgan
Salomé's feminine wiles have inspired writers, painters and musicians for 2,000 years

Salomé: A head for seduction

Salomé's feminine wiles have inspired writers, painters and musicians for 2,000 years. Now audiences can meet the Biblical femme fatale in two new stage and screen projects
From Bram Stoker to Stanley Kubrick, the British Library's latest exhibition celebrates all things Gothic

British Library celebrates all things Gothic

Forthcoming exhibition Terror and Wonder: The Gothic Imagination will be the UK's largest ever celebration of Gothic literature
The Hard Rock Café's owners are embroiled in a bitter legal dispute - but is the restaurant chain worth fighting for?

Is the Hard Rock Café worth fighting for?

The restaurant chain's owners are currently embroiled in a bitter legal dispute
Caribbean cuisine is becoming increasingly popular in the UK ... and there's more to it than jerk chicken at carnival

In search of Caribbean soul food

Caribbean cuisine is becoming increasingly popular in the UK ... and there's more to it than jerk chicken at carnival
11 best face powders

11 best face powders

Sweep away shiny skin with our pick of the best pressed and loose powder bases
England vs Norway: Roy Hodgson's hands tied by exploding top flight

Roy Hodgson's hands tied by exploding top flight

Lack of Englishmen at leading Premier League clubs leaves manager hamstrung
Angel Di Maria and Cristiano Ronaldo: A tale of two Manchester United No 7s

Di Maria and Ronaldo: A tale of two Manchester United No 7s

They both inherited the iconic shirt at Old Trafford, but the £59.7m new boy is joining a club in a very different state
Israel-Gaza conflict: No victory for Israel despite weeks of death and devastation

Robert Fisk: No victory for Israel despite weeks of devastation

Palestinians have won: they are still in Gaza, and Hamas is still there
Mary Beard writes character reference for Twitter troll who called her a 'slut'

Unlikely friends: Mary Beard and the troll who called her a ‘filthy old slut’

The Cambridge University classicist even wrote the student a character reference
America’s new apartheid: Prosperous white districts are choosing to break away from black cities and go it alone

America’s new apartheid

Prosperous white districts are choosing to break away from black cities and go it alone