Buying Properties Abroad Can Get You on to the Real Estate Ladder
It has been proven time and again that investing in real estate yields higher and more stable returns than other investment vehicles. However, getting on the property market is not as easy as others make it appear to be. House prices and mortgage availability are two of the factors that are driving young investors out of their home countries, including the United Kingdom and the United States.
In last year alone, there has been an 80% increase in the number of British people between the ages of 25 and 44 who showed interest in buying foreign properties. This trend has been gathering pace over the past few years. A study published in September 2013 showed a 25 percent increase in people who are in their 30s buying houses abroad, with the US and Spain being the most popular markets.
Office for National Statistics (ONS) revealed recent data showing at least two million people who left the UK within the last decade. But because the overall emigration rate is low, it can indicate that the increase in interest in buying properties in other countries could be driven by people’s desire to get on the property ladder.
Co-founder of the Intergenerational Foundation Angus Hanton is concerned that the figures could be a sign of the UK’s growing age divide, which could cause huge social problems in the long run. He said, “At risk is a potential brain drain, asset drain and generational drain if these young people choose to move abroad permanently in the future, having been let down by the UK… Policymakers must do more to help the many under-40s locked out of the housing market to put down property roots at home rather than abroad.”
Because of the soaring prices of housing in the UK, young professionals who wanted to invest in the real estate market are forced or pressured to buy abroad. What’s more, they see the property sector in other countries as relatively more affordable, thus making them want to take advantage of it.