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
Life and Style
techPatent specifies 'anthropomorphic device' to control media devices
Voices
The PM proposed 'commonsense restrictions' on migrant benefits
voicesAndrew Grice: Prime Minister can talk 'one nation Conservatism' but putting it into action will be tougher
News
Ireland will not find out whether gay couples have won the right to marry until Saturday afternoon
news
News
Kim Jong-un's brother Kim Jong-chol
news
News
Manchester city skyline as seen from Oldham above the streets of terraced houses in North West England on 7 April 2015.
news
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

Guru Careers: Software Developer / C# Developer

£40-50K: Guru Careers: We are seeking an experienced Software / C# Developer w...

Guru Careers: Software Developer

£35 - 40k + Benefits: Guru Careers: We are seeking a Software Developer (JavaS...

SThree: Trainee Recruitment Consultant / Resourcer

£18000 - £23000 per annum + Commission: SThree: As a Trainee Recruitment Consu...

Ashdown Group: UI Developer - (UI, HTML, CSS, JavaScript, AngularJS)

£25000 - £40000 per annum: Ashdown Group: UI Developer - (UI, JavaScript, HTML...

Day In a Page

Sun, sex and an anthropological study: One British academic's summer of hell in Magaluf

Sun, sex and an anthropological study

One academic’s summer of hell in Magaluf
From Shakespeare to Rising Damp... to Vicious

Frances de la Tour's 50-year triumph

'Rising Damp' brought De la Tour such recognition that she could be forgiven if she'd never been able to move on. But at 70, she continues to flourish - and to beguile
'That Whitsun, I was late getting away...'

Ian McMillan on the Whitsun Weddings

This weekend is Whitsun, and while the festival may no longer resonate, Larkin's best-loved poem, lives on - along with the train journey at the heart of it
Kathryn Williams explores the works and influences of Sylvia Plath in a new light

Songs from the bell jar

Kathryn Williams explores the works and influences of Sylvia Plath
How one man's day in high heels showed him that Cannes must change its 'no flats' policy

One man's day in high heels

...showed him that Cannes must change its 'flats' policy
Is a quiet crusade to reform executive pay bearing fruit?

Is a quiet crusade to reform executive pay bearing fruit?

Dominic Rossi of Fidelity says his pressure on business to control rewards is working. But why aren’t other fund managers helping?
The King David Hotel gives precious work to Palestinians - unless peace talks are on

King David Hotel: Palestinians not included

The King David is special to Jerusalem. Nick Kochan checked in and discovered it has some special arrangements, too
More people moving from Australia to New Zealand than in the other direction for first time in 24 years

End of the Aussie brain drain

More people moving from Australia to New Zealand than in the other direction for first time in 24 years
Meditation is touted as a cure for mental instability but can it actually be bad for you?

Can meditation be bad for you?

Researching a mass murder, Dr Miguel Farias discovered that, far from bringing inner peace, meditation can leave devotees in pieces
Eurovision 2015: Australians will be cheering on their first-ever entrant this Saturday

Australia's first-ever Eurovision entrant

Australia, a nation of kitsch-worshippers, has always loved the Eurovision Song Contest. Maggie Alderson says it'll fit in fine
Letterman's final Late Show: Laughter, but no tears, as David takes his bow after 33 years

Laughter, but no tears, as Letterman takes his bow after 33 years

Veteran talkshow host steps down to plaudits from four presidents
Ivor Novello Awards 2015: Hozier wins with anti-Catholic song 'Take Me To Church' as John Whittingdale leads praise for Black Sabbath

Hozier's 'blasphemous' song takes Novello award

Singer joins Ed Sheeran and Clean Bandit in celebration of the best in British and Irish music
Tequila gold rush: The spirit has gone from a cheap shot to a multi-billion pound product

Join the tequila gold rush

The spirit has gone from a cheap shot to a multi-billion pound product
12 best statement wallpapers

12 best statement wallpapers

Make an impact and transform a room with a conversation-starting pattern
Paul Scholes column: Does David De Gea really want to leave Manchester United to fight it out for the No 1 spot at Real Madrid?

Paul Scholes column

Does David De Gea really want to leave Manchester United to fight it out for the No 1 spot at Real Madrid?