Surge in the number of people looking to retire abroad
More people than ever before wish to retire overseas, a new survey indicates. The number of future retirees aged between 45 and 64 who are considering buying a home abroad has risen from 30% to 38% since the start of the recession in August 2006, HSBC said.
This equates to 5.4m Brits that are considering an overseas property purchase, as well as one in ten or 592,400 future retirees who told the bank they definitely plan to buy abroad.
The favourite retirement hotspot is Spain, with a quarter of those surveyed preferring it, followed by France, Italy, Portugal and Greece. Two thirds (66%) of those surveyed would buy on the coast, while nearly a quarter (23%) would prefer the countryside. Only 6% would buy in the mountains and 5% would buy in a large town or city.
However, the majority of would-be buyers would prefer to keep their roots in the UK and not move abroad permanently. Nearly two thirds (62%) would stay in their overseas holiday home for between three and six months a year while a fifth (19%) would use it for no more than three months a year.
Brits buying abroad plan to spend an average of £116,800 on a property, HSBC said, with the vast majority saying they would purchase the property outright, rather than with a mortgage.
Over a third (36%) said they would use savings to fund the purchase while nearly a quarter (24%) would downsize in the UK to release the funds required. One in twenty (4.5%) would use a lump sum from their pension to provide the funds, while 4% would remortgage their current home to release the money.
James Yerkess, head of foreign exchange at HSBC, said: "The economic downturn has had an impact on the income and savings of many but it has also helped lower the price of property in numerous overseas locations.
"Many of the baby-boom generation, who are now approaching retirement, are fortunate enough to remain relatively asset-rich despite recent economic frailties and this has opened up opportunities to take advantage of lower property prices abroad."
Top retirement hotspots
1. Spain: 26.2%
2. France: 15.5%
3. Italy: 9.5%
4. Portugal: 6.7%
5. Greece: 6.7%
6. Cyprus: 5.2%
7. Caribbean: 5.2%
8. Balearic Islands: 4.3%
9. Florida: 4.0%
10. Turkey: 1.9%