Soaring value of overseas second homes

THE value of second homes abroad owned by people from the UK has more doubled over the past four years, Government figures showed today.

In 2003/2004 people in the UK owned 256,609 properties in foreign countries, collectively worth £23 billion, up from just £11.1 billion four years earlier, according to the Office of National Statistics.

The boom in foreign property ownership has been fuelled by low interest rates and soaring house prices in this country, as cheap mortgages and the ability to unlock equity from their main home has made buying a place in the sun affordable for increasing numbers of people.

In 1999/2000 just over 176,000 people owned a property abroad, with second homes collectively worth £11.1 billion, and even in 2002/2003 overseas property holdings were only worth £16.4 billion.

Spain is the most popular place for people in the UK to buy a second home, with 69,284 properties owned there, accounting for 27 per cent of the total in number and nearly a third in value.

France was also popular with 51,322 properties owned by people from the UK collectively worth £5.6 billion, followed by Portugal and Italy where 5,132 and 2,566 homes are owned respectively.

Overall nearly two-thirds of second homes abroad are in Europe, with 6 per cent in the United States and the rest in countries such as Australia, New Zealand, Canada, India, Pakistan, South Africa, Sri Lanka and Caribbean islands.

The ONS estimates that during 2003/2004 people in the UK received rental income totalling nearly £190 million from foreign property.