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19/03/07 - Younger Investors Looking Abroad |
New figures reveal the emergence of BARBies (Buying
Abroad, Renting in Britain)...
High property prices in the UK, a fear of rising interest rates and stamp duty are driving young people to look at
buying property abroad, according to a new survey by Hiscox, the specialist insurer. Almost 40% of young people
would consider buying abroad as a first step to getting on the property ladder.
Overall, 88% of people say excessive house prices are the main barrier to buying in the UK with this figure rising
to 97% among 18-24 year olds. Two thirds (65%) of respondents quoted rising interest rates as a barrier; 58% stamp
duty; and 36% felt the whole process is too long and complicated in the UK. Almost a third (29%) had real concerns
the housing market would crash in the next couple of years.
Indicating the emergence of a new social group for the Noughties - the BARBies (Buying Abroad, Renting in Britain) –
the survey found that over a third of people (35%) fear they will never be able to afford a house in the UK, and
more than a quarter (27%) of these would consider buying abroad just to get themselves on the first rung of the
property ladder.
Worried BARBies
Young people under 35 are the most anxious about their failure to get on the housing ladder, with 37% worried that
they will never become a UK home owner. People living in London and the East Midlands are the most worried of any
region (21% and 24% respectively).
BARBies are primarily seeking good investment potential. Three quarters (74%) now see buying abroad as a more
affordable option and among 18-24 year olds this percentage increases to 84%. Other perceived advantages of buying
abroad include a better rental income than the UK (48%) and a simpler purchasing process (27%), not to mention the
fact that they might be able to combine renting with using the property as a holiday home (70%).
Perhaps unsurprisingly, given the relative cost of living, non home owners currently living in the South East are
most likely to be thinking of buying overseas property as an investment (38%). In the battle of the sexes, men are
much more likely than women to consider this option (33% compared with 22%).
Steve Langan, UK Managing Director at Hiscox, commented: “More young people than ever before are finding their route
into the UK property market blocked and are turning to overseas property investment as a more affordable and
potentially lucrative investment option. In the 1980s, Yuppies started to push UK property prices up and the signs
are that twenty years later the BARBies could do the same for property prices abroad. We’re already insuring
thousands of homes abroad and we are seeing a strong rise in the number of foreign properties being bought: our
client base more than doubled in the past year alone.”
Hiscox commissioned the survey to coincide with the launch of its website designed specifically to advise overseas
home buyers of insurance (overseashomes.hiscox.co.uk). Hiscox provides overseas home insurance cover in more
countries than any other UK insurer and specialises in non-English language speaking countries. |
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