With nearly 90,000 Britons having abandoned their Spanish dream last year, house prices in the country have plummeted. However, where many peoples dreams have turned to dust, a new breed of British expat is setting up camp – the retirees.
One of the main reasons many Brits were jumping ship, so to speak, was the disturbingly high unemployment rates that have hit Spain over the last 5 or so years. In April this year, a whopping 25.9 per cent of people of working age in Spain were unemployed, a rise of nearly 5.5 per cent since the same period in 2011, and 15 per cent up on the 2001 figures, a year that witnessed a record number of Brits emigrating to the country.
Clearly, retirees will not be faced with this problem, many have significant amounts of savings and receive a state pension, combined with the strong value of the pound versus the weakened Euro, it is easy to see why our over 50’s are flocking to the mediterranean country.
The stagnant economy has created a massive glut of cheap housing on the real estate market many of which have been repossessed by banks with lenders increasingly keen to shift them quickly.
According to the Telegraph, estate agent Your Viva, which has offices on the Costa del Sol, one of the main destinations favoured by British expats, 42 per cent of its buyers in 2013 were British, up from 31 per cent in 2012, with the majority aged between and 40 and 60 years.
Martina Heynemann, managing partner at Your Viva told the Telegraph that property prices have fallen 50 to 60 per cent from their peak in the early 2000’s. She said that prices are finally starting to pick up, particularly at the cheaper end of the spectrum and that the average property sold by the firm is worth around £180,000 or €222,000.
British buyers also see the strong pound as a reason to move abroad. Last week British pound sterling rose to its strongest point against the euro since December 2010. Since November 2013, the sterling to euro exchange rate has improved by an impressive 7 per cent.
Money corp, a company which provides money transfer services for real estate purchases, has recently said that they have recorded a 37 per cent increase in the volume of purchases in Spain over the last 12 months.
Ron Wilkinson, Spanish property expert at Alta Vista property thinks that the influx of retired Brits moving to the country is good news for both the British and the Spanish.
“Prices have hit rock bottom, and this means that Brits are going to be getting top quality properties at a bare minimum price, the combination of these factors and the strong pound mean that living in Spain can equal a very easy life in the sun for retirees looking to move abroad
“There are also huge benefits for the Spanish real estate market, as the influx in property interest means that prices will get driven up, and this can only affect the market, and in turn the country’s economy, positively.
“Hopefully, in the near future we will see prices beginning to return to their pre-recession values and when the excess housing has been filled, construction can begin again, which will help to deal with the unemployment crisis.”
Bradley shore is an experienced travel and investment writer whose main interests are property investment worldwide, he writes for many clients such as Alta Vista, but would one day like to run his own successful blog.