For many years now France has enjoyed the title of Europe’s most popular property market for overseas investors for an array of different reasons. There is the very varied climate, the distinct variation in prices and the fact that whatever style of property, whatever budget and whatever lifestyle you are after, there will be something for you. However, it looks as though ongoing problems within the European economy have focused the minds of many overseas investors towards Spain.
A recent report by IXPVisas confirmed that France’s title as most popular overseas property market could well be about to change hands. On the surface it is perhaps difficult to understand why Spain is set to overtake France, with Italy in third place, but if we look at the basics, the economic outlook and value for money, does this make the situation any clearer?
Spanish property market
It is common knowledge that the Spanish property market has been in serious trouble over the last few years, the economy is suffering, unemployment is at record levels and austerity measures are seemingly not able to stop the haemorrhaging of money. It is also worth noting that the Spanish banking system has gone through a major overhaul and indeed many of Spain’s more prominent banks are still suffering a financial hangover from the Euro crisis.
Quote from PropertyForum.com : “There is no doubt that the so-called “Golden Visa” has had a major impact on property prices in Spain with buyers from Russia, China and the Middle East flocking to the region.”
As a consequence, there is an array of properties available across Spain at what many perceive to be rock bottom prices offering excellent value for money in the longer term. There is ongoing speculation that the Spanish banking community still has a significant number of properties from customers who defaulted and these will be drip fed onto the market and basically “sold at any price”. They say it is always darkest before the dawn, could we be about to enter a new day in the life of the Spanish property market?
Is France on the way down?
While the French property market has suffered in line with the rest of Europe it is the previous strong position which France held within Europe which is causing concern – the country was a leading light along with Germany and very influential. We have seen a major change in political direction, a new government and an array of socialist policies which many believe will put back the ongoing recovery in the French economy. All of this uncertainty, with many people seeing the current government as antibusiness, certainly seems to have put off many overseas investors although France still remains the most popular tourist destination within Europe.
Whether or not this is a short-term lapse in the overseas property market stakes remains to be seen because there are fundamental issues which the French government needs to address sooner rather than later. It may also be that the Spanish property market has fallen so far that compared to the French property market there is better value for money – or at least better perceived value for money in the short to medium term.
Many people who are looking to invest in overseas real estate markets or move to a new life seem to be looking towards Spain in the short to medium term. While France still officially maintains its number one position as the most popular European real estate market those who are looking to buy property in the short-term seem to be favouring Spain over France. The perception that more investors are looking towards Spain in the short to medium term, compared to the likes of France and Italy, is perhaps a reflection of the potential value for money available in the Spanish property market?