Smart Traveller

Whilst buy to let properties are receiving a bad press in the UK with the government introducing a number of policies to make it more difficult for landlords to turn a profit from their properties. Whilst the UK market has been booming over the past few years since the market crash in 2008, our European counterparts have suffered a slower recovery meaning that there is still ample opportunity for UK investors to make a profit through property in Spain.

There is now a recovery taking place across property in Europe, but the British are still in a good position because of a number of different factors. The combination of a slower recovery, a relatively weak currency and a large recovery in the number of tourists travelling to Spain, mean that it is still amongst the best times there have ever been to purchase a property in Spain.

Property Prices

For those that have followed the European economic news over the past few years you would know that Spain had one of the worst economic situations and the property market crash was amongst the worst in Europe. Property prices dropped dramatically from 2008 onwards and it is only in the past year or so that they have started to recover slowly. Prices are still low and there are some great offers available for purchasers in Spain as the supply far outstrips the demand – the complete opposite to the UK. With a huge number of properties on the market to sell and not too many people buying them, the purchaser is in a very strong position.

Currency

The Eurozone has been greatly affected through the Greek financial crisis of the past two years and due to a number of defaults on loans payable to the European Central Bank and additional loans being requested, the whole Euro currency has been shaken. This has seen the value of the Euro plummet with near €1.40 to £1.00 being the current rates attainable. These kind of rates have not been seen since the start of the financial crisis in 2008, in between these dates the Euro had almost been at parity with Stirling, so the exchange rate makes any potential purchase more affordable.

If you make the comparison against other currencies, it is clear that the Euro is the weakest against Sterling with the US Dollar retaining its strength. The same goes for a number of other stable currencies against the Pound, this means that if you were looking to purchase property in these countries you would have to look a lot harder for a deal.

Tourism

If you are looking at a Spanish property for an investment, rather than moving out to the country permanently, then the tourism sector will be your lifeblood. The price of fuel has reduced dramatically with the price of crude oil falling under $40 per barrel, compared to $115 in June 2014. Prices have not been these low since 2009 and it is expected that the drop in oil prices will also translate into a drop in flight prices. This has led to tour operators expecting a bumper summer season next year with record numbers of tourists visiting Spain.

In 2014 there were an estimated 65 million tourists who visited Spain – all who needed accommodation for their stay. This figure is almost the same as the total number of people living in the UK and it is expected to rise even further both in 2015 and 2016. This is also down to the currency exchange rate and the economic recoveries seen in other countries. More people have more money to spend on holidays and with a weak Euro their money goes further. With demand for holiday lets and more money being brought into Spain via tourism, there is no better time to own a holiday let property in the Sun.

People are attracted to Spain for its warm Mediterranean climate and style of life, however there has hardly been a better time to invest and make the step into property ownership abroad. No only will you have a holiday home that you can make the most of, you can help pay for it by taking advantage of the growing tourism market and the low purchase prices.

Article provided by Mike James, an independent content writer in the travel industry – working alongside companies such as Marbella’s longest running real estate agent Panorama.es, who were consulted over the content in this piece.