Affordable Spanish property attracting British retirees

A potent combination of a strong pound, the endless-appeal of the Costa del Sol and lower property prices is drawing British retirees back to the Spanish property market in their droves.

With the average property selling at VIVA for around £180,000 last year, British buyers aged between 40 and 60 are driving the market’s ongoing recovery – accounting for 42 per cent of all homes sold by VIVA in 2013…

Despite nearly 90,000 Brits leaving Spain to return to the UK last year, the attractions of the Spanish property market – and particularly that of the Costa del Sol – remain abundantly clear. Allied to years of price corrections that began as soon as the global financial crisis first struck in 2008, property in Spain has never been fairer priced. And with the widest choice and most mature infrastructure, the Costa del Sol is leading the recovery charge.

As confidence floods back to the Spanish property market, so too does British buying power. Not only has the UK’s own economy stabilised and exhibited encouraging growth over the past 12 months, but sterling has also regained its place among the elite-performing currencies, rising against the euro to its strongest point for more than 18 months.

Such serendipitous circumstances have not gone unnoticed by a newly ambitious bunch of Brits keen on ‘getting off the hamster wheel’ that is life in the UK, with a property in Spain still viewed as one of the best lifestyle investments one can make.

One key difference in Spain’s property market this time around is the difficulty that some may find in obtaining a mortgage in Spain.

Pre-2008, mortgages of more than 90 per cent were often readily available, with Spanish banks eager to lend as much and as often as they could, to a wide demographic of buyers. Today, with caution the key buzzword, lending criteria has been tightened, with local experts advising buyers only to contact a domestic bank once they have at least 30 per cent of the purchase price ready as a deposit. For Brits buying in Spain, it Is likely that Spanish banks will not go much lower than 4.5 to 5 per cent on a loan, so it pays to save as much money up front as possible.

According to the Daily Telegraph, it is most commonplace for British buyers to either sell up in the UK or remortgage their British property in order to free the capital required to buy in Spain.

However, whichever way you wish to finance your property purchase in Spain, the general word of advice is – act soon.

Prices may have been cut by as much as 50 per cent in some regions, but the consensus is that the bottom of the market has now been reached, meaning prices are likely to begin rising again soon.