Brits Staying Closer to Home for Second Home Purchases

Brits reject far-flung destinations in flight to safety‏

British overseas home buyers are reverting back to more traditional second home destinations, according to a survey of 1200 second home owners by Savills International.

During the overseas property boom, the proportion of Brits buying outside of Western Europe grew significantly as buyers became motivated by the potential for capital gains.  However, since the market turned in September 2008, buyers have returned to the traditional favourites of Spain, France, Portugal and Italy.

“In 2010, the overseas second home market will be characterised by cash-rich, lifestyle buyers benefiting from lower prices in traditional, established holiday home hotspots.” Says Charles Weston-Baker, Head of Savills International.

The survey data also confirms that 2009 was one of the worst years for the industry.  70% of respondents invested in overseas property between 2003 and 2008 but just 2% had in 2009.

Rebecca Gill, research analyst at Savills International comments. “Whilst UK overseas home ownership has doubled since 2001 recent global recessionary trends have seen take-up levels dramatically slow. Factors such as fewer overseas holidays, reduced leisure spend capacity and financing availability, unfavourable exchange rates and declining house prices have impacted second home purchasing activity.”

20% of owners plan more purchases

The positive news is that a fifth of respondents said they are considering or planning additional holiday home purchases in the future.  The top ten destinations being considered were France, Spain, Portugal, the US, Italy, Greece, Cyprus, Morocco, Brazil and Turkey.

However, further property price falls, better mortgage availability and a strengthening of sterling against the Euro are all necessary conditions before we see the market return to anywhere near the transaction volumes of 2007.

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