If you’ve decided that 2023 will be the year you buy a property abroad, you might want to know what’s happening in the international property market right now.
International currency transfer specialist, Clear Currency, has teamed up with AIPO, the Alliance of International Property Owners to highlight the trends they expect to see over the next 12 months.
Q: Is there still demand for Brits to buy property abroad?
A: Covid-19 and Brexit might seem like reasons to move abroad, but Peter Robinson, founder and director of AIPO, says these are not the main motivators for most people – it’s just something they’ve always dreamed of doing.
“The market – as in British people buying foreign property – has softened a little,” he says. “It’s probably 75 per cent of the volume it was pre-Covid, but the 75 per cent that want to buy and make a move and a change in their life are doing so because it’s a long-held dream. Brexit, Covid, cost of living, all these sorts of things, are not actually the key drivers."
Q: Where are the top international property hotspots in 2023?
A: The majority of people who want to buy a home abroad are doing so in the usual places, Peter says. “In terms of demand, it is the usual suspects, where people have gone on holiday throughout their lives and tend to buy a second home or look to retire.”
France and Spain remain among the most popular destinations for Brits to buy abroad – in fact, looking at the latest figures from the Spanish Land Registrars’ Association, AIPO says that British demand was up 72 per cent compared to last year and 20 per cent compared to 2019, before the pandemic.
Peter shares that Lisbon in Portugal has also become a hotspot, and that countries with large expat populations will make themselves even more attractive to northern Europeans over the next 12 months. Countries with a Mediterranean coastline are therefore likely to become even more competitive.
Savvy buyers are also choosing destinations further afield. “Cyprus and Malta are becoming more popular with buyers from the UK, if only because they have very advantageous tax regimes for people looking to retire,” Peter explains. “It's only 5 per cent of your pension, so that tends to appeal to the budget-conscious part of people that don't want the taxman to have a good grasp of their hard-earned money.”
Non-EU markets like Morocco, Turkey, the US and Canada are also seeing increased demand.
Q: Do Brits remain living abroad once they have moved?
A: During the pandemic, many expats already living abroad chose to down or ‘right’ size where they were already living, and this has remained a constant. This means fewer people are choosing to return to the UK.
“The UK isn’t perhaps as aspirational as it might have been for expats coming back,” Peter reports. “Health services such as the NHS are waning, so it’s not a slam dunk that you’d come back for medical care, which is what a lot of people would tend to do.
“People that bought into a property abroad 20, 30 years ago and haven’t kept the bolthole just can’t afford to move back quite frankly – unless they return with a relative and not every son or daughter wants an ageing parent back with them.”
Those who retired abroad several years ago may currently have different living requirements - and international markets are now catering to this, too.
“You have got some new initiatives in what are called integrated retirement communities,” Peter says. These provide accommodation abroad for British expats who have experienced an illness or bereavement but still want to continue living overseas.
“Care homes are not always aspirational,” he adds. “What people want is a senior living resort, so to speak, and what Covid has done is spun out some places that have failed or are now available for purchase because they just haven’t been able to weather the downturn in holiday business and are presently being repurposed as senior living communities."
Q: Has hybrid working influenced people’s desire to buy a property abroad?
A: Technology like Zoom and Microsoft Teams has made it even easier for people to work remotely - a practice which many adopted during the Covid pandemic and continued even after offices reopened.
While the overseas property market is largely made up of second homeowners and retirees, Peter says there is now a supplementary group of remote workers relocating abroad too – and it’s no longer just the domain of cabin crew. If people can work abroad, many are choosing to.
In some European countries, mortgage rates are lower than in the UK, which means those working abroad on their UK salary might get a better deal. However, it’s still important to get clued up on the financial impact of buying a property abroad. Deposits can be higher, for example, and you will still have to pay stamp duty and capital gains tax, so seeking advice can be useful.
Q: Are there any new opportunities coming to the overseas market?
A: As well as a new home, buying a property abroad can bring lots of other opportunities too, including the potential for new business ventures.
Peter suggests that even people who buy a retirement home abroad often seek out part-time work. “History shows that they get bored,” he says, “which is why there are lots of British estate agents in Cyprus, Malta, Spain, France, Italy – you name it.”
Because a lot of British expats don’t learn the language, other Brits who want to go into business abroad have a captive audience.
He goes on to say: “A number of small enterprises are being set up overseas, whether it's due to expats selling property back to fellow Brits, because they’ve been through the process, or sandwich coffee bars and the usual sort of food and beverage offerings - a lot of which have been laid to waste during Covid so there’s a gap in the market to open some new businesses.”
Q: How can Clear Currency and AIPO help you to make the move abroad?
A: Clear Currency can help you save money on your mortgage currency exchanges. They can transfer money across 35 currencies in 130 countries. Use their secure online platform to make an international payment at any time, access live rates and see the status of your payments.
When you create an account with Clear Currency, you will be assigned a dedicated currency specialist who can make you aware of the geopolitical and socioeconomic events currently influencing market volatility, which in turn can help you to mitigate currency risk exposure.
When purchasing a property abroad it's crucial to enlist the services of a currency specialist. They can help you find ways to save more of your hard-earned money when making overseas money transfers. Get in touch with one of their experienced team today.
Clear Currency is FCA regulated and has a 5* Trustpilot rating.
AIPO is an organisation that supports British-resident owners and buyers of foreign property and was set up by the same team behind the AIPP – the Association of International Property Professionals, a not-for-profit trade membership founded to improve education, protection and standards in the international property industry.
To find out more, visit clearcurrency.co.uk.
Call +44 (0)20 7151 4871 or email edp@clearcurrency.co.uk for more information.
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