EDITOR’S BLOG: A property affair
What is it with us Brits and property? We just cannot get enough of it and, now, the way we own it, and the places we own it in, are undergoing big changes as our obsession shows no signs of abating.
First of all, here are a few mind-bending stats. Mortgage lending in March this year was a record-breaking £31.3bn, 22% up on the month earlier and 10% higher than March 2006. It is estimated that about 70% of the total population of the UK is a property owner, a vast increase since the post-war days when around only 10% were.
But domestic homeowners are now spreading their wings, with Spain boasting one of the biggest ex-pat communities of Brits in the world. Typical of the Spanish settler is 56-year-old Brian Ball, a builder from Essex, who has just completed his villa near Almeria in the south-eastern province of Andalusia.
“I was sick and tired of England and just wanted somewhere for me and my family to relax at any time of the year in good weather,” he says. “As a builder I undertook most of the construction work myself, flying out pals when I needed electricians, plasterers, carpenters and so on. This, for me, was a much better use of my money than buying a ‘ready-made’ property and I have got exactly what I want now.”
Good for Brian, but for others the Spanish adventure can quickly go wrong. David and Jean Simmonds decided to retire to the Costa Brava after a holiday there eight years ago, but the hot Spanish sun only curdled their dreams and turned their lives very sour indeed.
“We bought an unfinished apartment just a few minutes’ walk from the beach,” recalls David, “and at first everything seemed fine but, looking back now, that was the calm before the storm.
“Soon we were embroiled in all sorts of legal hassles concerning the ownership of the property and were racking up charges by the truckload. And, suddenly, all the nice people over there helping us couldn’t speak English any more and turned quite nasty when it came to giving us advice.”
In the end, David and Jean gave up on their Spanish dream – but only after losing a substantial sum of money and many months of peaceful sleep to chronic anxiety. “Basically, it turned into a nightmare for us,” says Jean, “and although we did in the end win back some of our money it was a case of too little too late.
“Thank goodness, we did not put everything into the property, because we could well have been homeless by now. I’m sure most people have better experiences than us but anyone considering the move to Spain should be aware that things can sometimes go drastically wrong. Always have a fallback position in case it does.”
True enough, and the recent rumours that the Spanish market is over-stuffed with properties, and local real estate companies that have borrowed to the uttermost limits of feasibility, should give anyone pause before they succumb to the siren songs of the sangria and cicadas. It’s a big step, so treat it like one with the appropriate seriousness.
Still, not everyone is into the life of easy exile and property ownership is expanding into other areas here at home. A recent report from market researchers Mintel has concluded that the number of buy to let homeowners may double in the next three years, with 3% of current householders thinking of buying another property to let out by 2010.
Given that only 10 years ago, most landlords were professional specialists the growth in what has become known as the buy to let sector has been astounding. At the end of last year there were 850,000 buy to let mortgages in existence, accounting for 9% of all mortgages. Mintel predicts that by 2011, more than half a million people a year will be borrowing to become landlords.
As Paul Davies of Mintel says: “Increasingly, property owners are seeing the benefits of investing in bricks and mortar and often regard the second homes market as a good alternative means of saving for retirement.”
And he’s right. We love property and the idea of just one boring old home for you and yours in dear old Blighty is fast becoming outdated as increasing affluence means we can indulge our foremost passion to a greater extent than ever before.