Who buys a second home?
More than a million Brits now own a second home, a quarter of them being abroad. They are becoming increasingly accessible, especially for the baby boomer population who ultimately seek to retire to the countries in which they are buying or at least live between two countries. They are usually nearing the end of their working life and are winding down to a more relaxed pace, preparing for relocation. Some may even intend to do some light work in their target country.
Why buy a second home?
Other motivators to buying a second, sometimes even third home abroad, include a safer investment compared with pension plans, stock market or to release equity from their existing property, and simply because they have the cash to spend as a result of inheritance or life long savings. Smaller down payments and the attraction of low interest rates make for a fool proof package and a logical alternative to other investment projects.
What was once a dream to own a place in the sun is now being taking for granted and by 2012 it is estimated that second homers will take 12 million flights a year to visit their homes abroad. A second property is typically used as a holiday home or to generate a rental income, often both.
Looking to buy further afield
The British have traditionally headed for the familiarity and convenience of the Spanish Costas but this popularity has driven the prices sky high and has encouraged people to venture into more unknown territories such as Turkey, Bulgaria etc.
Are they selfish?
Expats will always argue that they bring economic benefits to the countries in which they buy. They believe that they contribute to the development of the local infrastructure and that the local inhabitants benefit from this. However, they often fail to realise the negative impact that they can have including pricing local people out of the market, as has happened in Spain. In fact, in 2003, nearly half of all property sold in Spain was sold to non-nationals. The truth is many young people remain living with their parents as they are unable to get on the property ladder after the explosion of prices. Similarly, second home buyers pushed the prices in the French region of Languedoc Roussillon up by more than a quarter in a period of just 12 months.
Not only are locals affeced financially but also socially. Second homers who decide to split their time between two countries are not contributing fully to neither of the two communities. They are in fact leading a double life which prevents them from fully integrating.
Written by
Susan Pedalino