Recap of holiday home news: 2 February 2010
It’s time once again for our holiday home news round up, here’s what’s been happening: Expats protest in Spain, the best countries to live in, council tax on second homes could double and the overseas property review of the decade.
The overseas property market in the noughties
What’s happened in the overseas property market in the last 10 years? which countries were the biggest winners and losers?
Ten years ago a Dubai sea view flat cost about £40,000, an apartment on Spain’s Costa del Sol was £75,000 making them attractive investments, especially with the low cost airlines making them easily accessible to holidaymakers.
But in recent years some homes bought in Dubai have halved in value, prices in Bulgaria are down 28% on a year ago and Florida villa prices have plummeted as much as 60% in four years.
Some think now is the time to snap up “bargains” in the locations where prices have fallen most, but these statistics are a reminder that purchasing holiday homes is not a sure-fire road to wealth. Over-supply and airlines closing routes can severely impact markets.
However, some traditional locations have bucked the trend. Prices at most French, Italian and Portuguese resorts have dipped only slightly.
It’s interesting to note that according to Knight Frank, Spain remains top of the table for price increases over the decade – up 122%. But that masks a dramatic roller coaster ride in values, especially in the past two years.
Investing for the long term, whether for family holidays or rental income can be wise – depending on the location and purchase price.
Expats protest as more Spanish homes are to be demolished
Around 800 British and Irish residents marched in Almeria after demolition orders were issued for eight expat-owned homes in the nearby town of Albox.
The local town hall had issued building licences for the Albox properties, but they were nullified following court action by the regional government.
Thousands of Britons have bought Spanish properties in good faith, only to find they were illegally built on protected land. There are fears that many more homes are under threat, which is yet another blow to the struggling property market in Spain.
Not sure where to buy a holiday home?
International Living magazine has released its 30th annual survey of the best countries to live. The survey analysed 194 countries and based results on nine criteria including the cost of living, leisure and culture, economy, environment, freedom, health, infrastructure, safety and climate.
France came out on top for the fifth year in a row, Britain has sunk to 25th place.
The top 10 countries are:
- France
- Australia
- Switzerland
- Germany
- New Zealand
- Luxembourg
- United States
- Belgium
- Canada
- Italy
Council tax on second homes could double
The government is considering steep increases in council tax on properties kept as second homes or holiday lets. Under the plans, bills would rise to double the standard rate.
Supporters of the move claim that increasing council tax on second homes would discourage owners from leaving them empty most of the year, whilst raising money to spend on affordable housing.
Potentially, this is yet another blow for holiday let owners. Why should holiday lets that bring income into communities and create jobs be treated the same as second homes that are used for only a few weeks a year or permanently left empty?
Surely they should be treated and taxed differently?
Holiday rentals market report 3rd quarter 2009 (PDF)
Holiday-rentals.co.uk have release a report on the holiday rental market, following a survey of users and advertisers on their website.
Although brief, the report provides some useful data for those looking to invest in a holiday let, or maximise rentals.
Some findings from the report:
- The economy is not stopping respondents from taking a holiday, but holidaymakers are looking for value, haggling and booking last minute
- Enquiries for the UK were up 90%, maybe due to the economy, the promise of a BBQ summer and the weak euro?
- For those looking to invest in a UK holiday let, but not sure where, the top destinations in UK were London, Cornwall, Devon and the Lake District
The report also lists the top ski destinations.