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08/08/07 -
More Brits Cash in on Overseas Property |
The number of British
holiday home owners downsizing or selling their place in the sun and
repatriating money to the UK has doubled in the last year according to
currency specialists HiFX.
This year has seen the most dramatic increase in the numbers of people
bringing money back to the UK as the first wave of the original baby boomers
who bought overseas are now choosing to downsize their foreign properties as
they get older.
Mark Bodega from HiFX commented: “The overseas property market really took
off about 20 years ago when the first tranche of Brits started looking for
their dream home in the sun; particularly in France and Spain. According to
our figures it now seems that these people are either downsizing to smaller
properties or selling their holiday homes now that their families have grown
up and are sending money home; only to be replaced by a whole new generation
of buyers.”
HiFX, which manages the transfer of over £100 million back to the UK each
year, has seen a 100% increase in the number of Euro back to Sterling
transactions in the last year. The largest numbers of people are sending
money back from Spain and France and the average age of those repatriating
strongly points towards downsizers.
One in five of those repatriating money from France are aged over 65 and 77%
of repatriators are aged 55 or above. In Spain 67% of Brits sending Euros
back to the UK are aged over 55.
Bodega continued: “France and Spain were the first overseas property markets
to truly mature and people buying there have matured with them – this is the
first time that we’ve really seen the impact of an ageing holiday home
owning population.“
Bodega explained: “Over the last 10 years, the Western world has enjoyed the
biggest property boom in its history. In fact, over the last decade house
prices have boomed in almost every developed market with the exception of
Germany and Japan. The Economist Research Unit calculates that the value of
property in developed economies has increased by $30 trillion over the last
five years, hitting a new total of $70 trillion. The increase is equivalent
to a year's GDP for all the countries combined. House prices in France,
Spain, the US and Italy have for example, all risen by more than 50%.”
“Whilst this boom has created a whole generation of potential property
investors, it seems that those Brits who bought 20 years ago are now selling
up, and choosing to purchase smaller properties. In Spain, for example,
Brits tend to move more inland away from the busy Costas.”
Avoiding the potential pitfalls of currency exchange
However to make the most of appreciation of assets when repatriating it is
essential that Brits consider using a currency exchange specialist rather
than their bank to send money back to the UK. Currency specialists such as
HiFX charge on average 4% less on foreign exchange transactions than high
street banks. On an average transaction size of €200,000 this can mean
losing out on as much as nearly £5,000 when they return to the UK.
Furthermore, banks subject Brits to a number of additional bank charges and
commission fees when transferring funds. Some overseas banks can charge as
much as 2% of the amount transferred in commission plus a transfer charge;
usually £25 for each and every transfer. UK banks are also guilty of
charging a receiving fee, typically 0.5% of the amount transferred. Currency
specialists like HiFX will transfer your money to the UK completely free of
charge.
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