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Why should I be considering this? “Buying off plan”For the last few years in the United Kingdom making money from property has been relatively easy. Anyone, even those with little understanding of property investment, could buy a reasonable property in a reasonable location and sit back as the value has increased almost daily. If they have been able to let the property and cover their holding costs, (including the costs of finance) they would have been almost guaranteed an increase in their wealth, on paper at least. Although the long-term trend for property prices in the UK is upwards, growth has not been consistent. The populace is increasingly expressing their concerns about higher prices that are keeping first time buyers out of the market, concerns about the amount of consumer debt, concerns generally about rising cost of living and their future financial security. In contrast Spanish coastal property prices have risen by at least 15% per annum since 1997, with even greater rises in the more sought after locations. Unlike the UK, rental property in Spain appeals not only to the long term let market, but you are able to combine this with peak holiday rentals, producing superb returns. FACT: The Economist reports that house prices from 1997 to 2006 have risen 173%. Spain's new prosperity is the product of long preparation and José Luis Rodríguez Zapatero (president of Spain), is surely right to assert that Spain will soon join Britain, France, Germany and Italy in the club of Europe's big five countries. The main Spanish airports are reporting and predicting further, sharp increases in traffic over the next few years, as budget airlines make it even more convenient to escape for a few days or weeks in the sun. Spain is embracing this increased air traffic and has two new international airports under construction in Corverra and Castellon. The airports at Alicante and Valencia are currently extending in preparation for the Americas Cup. The Spanish National Statistics Institute predicts that the immigrant population (British, German, and Dutch etc) will rise to as much as 5.5 million by 2010, representing in the region 12% of its population, compared to just 5% in 2001 and many of these new residents will be seeking long term rental properties. A recent report by the UK Institute for Public Policy Research estimates that as many as 3.3 million pensioners could move abroad by the middle of the century. An estimated 5.5 million British people live permanently abroad. During 2005, 2,000 Britons permanently moved overseas every week. The most popular overseas destination was Australia, as 1.3 million Britons now live down under, Spain is the second most popular destination, with 761,000 British emigrants in permanent residence, additionally there are 990,000 part time British residents in Spain, 74,636 of whom are pensioners. Within Europe, Spain is the number one destination as the British love affair with the Spanish coastline continues by a strong lead. The other European favourite destinations that might be of interest to you are: Ireland 291,000 The result is? House prices in Spain are set to rise still further, maybe not as high as in previous years, as construction is booming in Spain and time is needed to reset the housing balance, but the demand will remain strong for Spanish property from tourists, holiday home buyers, the increasing amount of families relocating overseas and not least from retirees, all of them looking for a good climate, beautiful surroundings, a lower cost of living and a better quality of life, just a few hours away from the UK. It is not possible to predict capital growth with any accuracy, however from experience and analysis we forecast that Spanish property prices will continue to rise at a rate far in excess of inflation and within a stable and comparatively risk free environment. You read all the time in the press different companies predicting future capital growth in the UK and how many actually get it right? If you do your own ground work, have the right strategy and you are prepared, there are still great investment prospects to be found in Spain, we have proven this with our own investments over the past few years. The following pages in this guide provide you with the essential advice to set you on the road to building your own successful property investment portfolio. IPS 2007 Index Page - IPS Guide Index page Page 2
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