Recognising overseas property hotspots ahead of the market rush
If I had a euro for every time someone asked me where to buy abroad next, I wouldn't be sitting here in wet and windy Ireland but lounging by the sea in sunnier climes. Emerging property hotspots are easy to find after the fact -- so what factors must you watch out for if you want to 'get in first'?
Overseascafe.com has been monitoring searches on Google and has calculated that there's still a whopping 6,877 searches per day from Ireland concerning overseas property. There is no doubt that our interest in property abroad is as strong as ever, so the key to success is research, research, research. Property markets abroad tend to be strongly influenced by foreign investment in the region, and this is unlikely to happen in an unstable political environment. A politically stable country with a growing economy will attract foreign investment and tourism, which leads to higher capital appreciation and greater rental demand.
The economic policies of the region are also important and for example in India, Special Economic Zones were set up to attract manufacturing companies which include a wide range of tax benefits. The government is meanwhile actively investing in improving infrastructure and facilities. If large multinational companies consider a country worthy of re-location, others will follow.
Accessibility is another factor -- ever expanding flight destinations, new and improved airports, increased rail and road access will all attract new interest. There are many who base their predictions on upcoming hotspots by following new airline destinations.
But there is also the journey to and from the airport to be considered, and a decent road network or comfortable and frequent public transport will make the region more attractive to tourists and investors alike.
In Morocco, under the Plan Azur, the government intends to spend £2.2bn on improving its economy, infrastructure and employment in order to achieve its target of 10 million visitors by the year 2010 and create 600,000 new jobs.
The development of high quality amenities greatly enhances desirability for property in specific locations. Professionally designed golf courses with well laid out accommodation and top of the range ski resorts will draw much attention.
Upcoming international events, particularly sporting tournaments, always have a positive effect on a region. Improved facilities such as access, accommodation and retail services to cater for visitors can only benefit the region.
In Valencia, Spain, securing the America's Cup yacht race last July and the Spanish Grand Prix (later this year) has led to a revitalised city and a booming property market. Property prices have increased by more than 60pc since 2004, according to the Spanish Ministry of Housing. In 2004, on the back of the America's Cup announcement, prices rose by 30.5pc, to become the highest in the country.
According to Conor Wilde of Spain and Property, the impact of these sporting events has completely changed the property market in Valencia: "The Valencian government has injected huge amounts of capital into the infrastructure of the city and we now have clients from all corners of Europe viewing inland and city properties," he says.
A final factor to note is what is happening in news stories overseas; how new laws or regulations that come into force could impact your overseas investment. In France for example, Nicolas Sarkozy has taken an active interest in updating property, tax and inheritance laws that are of benefit to the investor.
Eilis FitzGerald is the managing director of www.overseascafe.com, a research website for overseas property, news, views and advice