It is almost two years since the UK voted to leave the European Union. When the shock result was announced, one of the main concerns for real estate agents and others in the property market was – how will Brexit affect Spain?
The fears were, and are, based on the fact that Britons form the majority of overseas buyers in the Spanish market, so a decline in numbers buying, because of concern about their status in Europe after the UK has actually left the EU, could potentially dampen what is once again a thriving property market.
Brexit – The Real Story
So far, a pessimistic outlook has proved unwarranted. Initially, in the months after the June 2016 Brexit vote, the number of British buyers did go through a downturn, but in 2017, this decrease went through a reversal at the end of last year, when minus figures suddenly turned into a plus. No doubt this has been encouraged by the UK government’s more conciliatory tone on the status of EU citizens in the UK, which should guarantee a more secure position for British citizens living permanently, or semi-permanently in EU countries like Spain, Portugal, France and Italy, four of the most popular countries for second-home ownership.
However, there are reports coming in from both estate agents and developers about the changing shape of the British buyers’ market despite Brexit. Some say that they are seeing an increase in buyers with a budget of €400,000 and above. Whilst, the middle market for properties between €200,000 and €400,000 is declining. This is boosting sales in the lower price range. One theory as to why the top and bottom ends of the market are doing so well, is that a number of buyers want to get their cash out of the UK before the final realities of Brexit kick in.
Of course, there is another money factor involved: the pound has been in a weakened state since the Brexit vote. Yet, that has not deterred buyers, who are simply going for the less expensive properties to offset the poor exchange rates.
Overall, it seems fair to say that Brexit has not dimmed the promise of a home in sunny Spain for many buyers. Market experts have been saying all along that Spain will do its utmost to protect the biggest group of buyers, the British. Yes, some things like reciprocal healthcare and pensions are still unresolved, but that won’t affect the wealthier buyers. And, even those who might be affected by these issues are still looking at Spain, because it remains the No. 1 choice thanks to its friendly culture and its excellent infrastructure, as well as its fantastic selection of properties.
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