Spain has come out as the number one destination for UK buy-to-let investors during 2005, a new study has revealed.
Figures released by the Office for National Statistics (ONS) have shown that the majority of UK people considering investing in property abroad are heading for the traditional favourite of Spain. Despite the emergence of many other vibrant property markets in recent years in particular eastern European destinations such as Bulgaria the figures reveal that most are keen to stick to the old favourite.
Many people recognise that Spain represents a solid investment, with property still in hot demand despite talk of a slowdown in the market and the country’s overall economy. That has failed to dampen the spirits of many property investors, who realise that the country is still hugely popular with British tourists as well as those from other countries, meaning that there will always be a market to help property prices grow.
And the number of people who have come to realise this fact has jumped considerably in recent years.
While the government’s U-turn on self-invested personal pensions (Sipps) had led some to fear that 2006 would result in a downturn in investment in foreign property, rather than the earlier anticipated increase, the ONS study suggests that the market will remain buoyant regardless of the Sipps situation.
This can be seen from the fact that 257,000 Britons now own a second home abroad, according to the ONS statistics, with spending on overseas investment jumping by 45 per cent in the last four years alone.
Over £23 billion was spent by Britons on foreign property investments last year, with Spain being the top destination.
However, the Spanish pull is not the only area interesting UK investors, with France coming second on the list.
According to the figures, while 27 per cent of foreign investments went on properties in Spain, 20 per cent of those investing in the property sector abroad chose France.
Overall, 75 per cent of all second homes owned by Britons are in England, highlighting the fact that the UK property market is still one of the strongest in Europe despite the slowdown over the last 12 months, with investors still seeing the UK market as having the potential to offer significant returns.
That view is endorsed by recent studies which have suggested that the housing market is back on track, with buy-to-let lending increasing at one of the fastest rates since the turn of the year.