Top Ten Tips for 2009

Where to buy overseas in 2009

Now is the perfect time to get the best deals on property overseas, and BuyAssociation.co.uk Property Editor Paul Collins picks out ten of the best places to find them in 2009.

Introduction

Sunshine for 11 months of the year, a vibrant lifestyle in a new city, the best pistes in the area on your doorstep, a retirement away from the UK – there are a huge number of reasons for buying a property overseas. Unless you have been living in a cave for the past six months, you are likely to be thoroughly sick of the phrase ‘credit crunch’. While it seems that almost every country in the world will be affected either directly or indirectly by the economic downturn, the reasons for buying property overseas remain the same for most people.

While the availability of easy credit has all but dried up completely, buyers with cash deposits are still able to find mortgage deals. The global recession means that there is an opportunity to buy property that would otherwise have been completely out of reach. Add to this the fact that in many overseas destinations the cost of living will be significantly lower than here in the UK, and buying property overseas could make sound economic sense.

Predicting the future of the property markets around the world is a near-impossible task, but the recommendations below should give you a feel for what to look out for in the year to come in overseas property opportunities.

Brazil

Making the list for the second year running, Brazil has been one of the biggest successes of the overseas property industry in the past 12 months as investors are drawn to the beach resorts springing up along the north east coast. They are in good company, as Chris Hoy whose three gold medals in Beijing were the best performance by a single British athlete since 1908, has bought on one of the newest developments. In the coming year however, it is the strength of Brazil’s economy that is likely to attract buyers, as the prudent policies of the government should allow the country to survive the worst of the downturn. Buyers are now interested in property in Brazil as much for the lifestyle element as for the investment potential. Many experts are predicting good things for Brazil in 2009.

Spain

It seems an obvious choice to put Spain among the top ten destinations for overseas property – a recent survey from Globaledge has identified it as still the most popular search for buyers of homes abroad. However, 2008 has been a tough year for the property market on the Costas, with developers and agents going out of business and owners having trouble selling their properties. But, combined with the effects of the global economic downturn, 2009 could be the best time to buy in Spain for years. Prices have reduced to levels unseen for some time, developers and agents are doing everything they can to attract interest and are competing for a smaller pool of buyers than previously. The reasons for wanting a property in Spain remain the same as ever and the advantages just as strong, so the coming year could be the best time to negotiate on price, position and extras on a property in Spain for years!

France

Another of the ‘old favourites’ on the list for 2009, but one that has become more popular as 2008 has progressed. France still attracts huge numbers of tourists from around the world, so from a rental point of view French property is superb. Coupled with the government-backed leaseback scheme providing steady, safe rental returns, it has great opportunities for those looking for a longer-term investment. As the credit crunch reaches across Europe, buying in Paris, Nice and Bordeaux will become cheaper and give many more buyers access to these exciting city centre locations. Furthermore, as budget airlines are forced to close unprofitable routes and environmental concerns over excessive flying grow in prominence, being able to get to your property overseas by car, boat or train could be a huge advantage.

Croatia

Having burst onto the overseas property scene a few years ago as the country began to emerge from years of devastating civil war, property in Croatia seemed destined for great things. A couple of years of slower growth have followed as other ‘emerging’ markets have built up their own hype, but Croatia remains a great destination. Imbued with fascinating history, remarkable scenery and a great culture, it is easy to see why people are attracted to Croatia from across the globe. Add to this the fact that the authorities are removing a large portion of the red tape involved in the buying process from February 2009, paving the way for full EU entry in a couple of years, and the package becomes even more attractive.

Australia

The firm favourite of those emigrating from the UK permanently, buying a property in Australia is the ultimate dream for many. While the buying and visa processes need buyers to prepare, get documents in order and make sure they have every angle covered off, the range of properties, locations and even climates that Australia has to offer mean almost everyone can find what they want. Times of economic turmoil often prompt people into making life-changing decisions – how tempting does it sound to forget about working in the UK and head to somewhere with a better lifestyle, climate and prospects for the future? People who have unfortunately been made redundant may just think now is the perfect time to make the move overseas. Prices in Australian cities have dropped in the past couple of years following a period of unsustainable growth when the market became overheated, but there are signs that they could be about ready to start a recovery soon. If you are thinking of relocating permanently, it is likely that Australia is on your list already.

Caribbean

The image of a perfect Caribbean beach is often the one people have in their mind when thinking about their ideal overseas property location – white sand, clear blue waves and a lifestyle to reflect the relaxed natural surroundings. In the current market climate, the best reason to buy a property overseas is for yourself, and the Caribbean is one of the best places in which to do that. The islands vary in size, atmosphere, pace of life, and of course, types of property. It is easy to spend millions on the best locations on the most prestigious golf courses on the islands, but at the same time it is perfectly possible to find a more modest property on a beachfront development for around £100,000. If you are planning on using the property for only a few weeks of the year, it is even possible to buy fractional ownership shares in a Caribbean property for as little as £25,000. For the opportunity to have the clear waves of the Caribbean Sea lapping at your toes for years into the future, this is one of the most attractive deals out there.

Poland

Property in Poland has been one of the most popular markets for overseas property investors in recent years, but it is the change in the economic circumstances around the world that make it a potential winner for 2009. As the economies of the western European countries to which Polish workers emigrated after the country joined the EU are suffering in recession, Poland has been growing steadily on a basis of long-term foreign investment. Now, many workers are finding that they have better opportunities to make money if they head back to Poland, but are unlikely to want to live in the same place as they did before. The new jobs in Poland are being created in the areas around the big cities, where new property developments are available. While returning workers are unlikely to be able to afford to buy in these areas, they will be able to rent on a long-term basis. Look at the ‘second tier’ cities such as Wroclaw, Krakow, Katowice, Lodz and Poznan for some of the best opportunities.

USA

Of course the economy is in recession, and of course the exchange rate between Sterling and the US Dollar is not at the same favourable level as it was earlier this year, but when you can get brand new properties in Florida for around 50 per cent of the list price, it is hard not to get excited. Developers are desperate to sell the remaining units on development that are either completed or partially-built, and they are offering some huge discounts in order to do so. Others are turning to ‘no reserve’ auctions in order to sell, and buyers are finding some of amazing deals on brand new completed properties. Much like the rest of the world, the economic downturn means that property in prime locations is more within reach of ordinary buyers, so think about buying in New York City or Los Angeles as well.

Turkey

Turkey has continued its progress towards EU membership this year, but it is the continued popularity of tourism to the country that will prove to be the advantage for overseas property buyers in 2009. Tourists arrive from right across Europe, which means that anyone buying property in Turkey has a huge rental market at which to aim. New developments are continuing to arrive on the market in the traditional tourist areas, while investment opportunities in Istanbul are attracting other types of buyer. Perhaps most importantly, there is now a mortgage market in Turkey, which opens up the opportunities for the domestic market to get involved in property purchases. In many ways, the property market in Turkey will develop throughout 2009.

Egypt

Another destination from last year that has made the list again. Egypt’s strength in the market derives from the fact that it attracts visitors from across the globe right through the year. It is developing as a package holiday destination for the mass market, as opposed to the more niche market that it used to serve and is adding golf tourism to attract even more visitors. At the same time, it remains one of the most popular diving locations in the world, and one of the most impressive. Government funding is rapidly improving infrastructure and services, and new resorts such as Marsa Alam are being planned intelligently to manage growth, development and building. Some parts of Egypt get just one day of rain per year – if you’re sick of the wet weather here, it is also a realistic destination for emigration, so a property in Egypt could be a holiday home, investment, or new main home.

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