Is now the time to purchase a holiday home abroad?

I

IsleOfMan

Registered User
Messages
925
If you were to purchase a holiday home abroad where would you purchase it and why would you choose that location?

With most accounts paying little or no interest in Ireland now, with the Prize Bond fund being halved again does it make sense to use your savings to purchase a holiday home?

Would you purchase it in your name or possibly in one of your children's names etc etc.
 
never saw the appeal of a holiday home myself ( id get bored visiting the same place each year ) but then again i dont love the sun as much as most

id have thought property in spain , portugal etc would have recovered quite a bit this past four years , especially the last eighteen months , spain is starting to boom and has been doing well for quite a while , from a monetary standpoint , perhaps jersey might be a good choice with the pound having weakened so much
 
I know of plenty who bought homes in the sun during the boom here and I know of no one who has made anything from them. One example is Turkey which i'd imagine is and has been a total disaster, Spain is another, people finding out after they had bought that there's no title deeds, prices have totally flopped, etc, etc. Cyprus where there's been an awful swindle with title deeds and you now cannot sell, never mind that some have bought in Northern Cyprus which is Turkish rule and the properties have been built on other peoples land. Dubai is another. Oh yes, lots who still have those properties are left with them and i'd imagine their children will inherit the disaster and that's a whole new different problem.
 
Just to present an alternative view, a family place in somewhere like Portugal can be fantastic. My folks split their time between here and there so it's in constant use. We use the place a lot, and so do my siblings and their kids.
 
Like Gordon indicates, that is our future plan too. We will purchase in Portugal but we want a place that is large enough for kids and family to visit.
Why Portugal? Current has no inheritence taxes for non-nationals. Also, I picked up a few Belvin-Franks legal books comprising France, Spain and Portugal. The book on Portugal is 1/2 the thickness of the book on Spain. Alot simpler system to buy and live (tax wise) in Portugal.
Firstly though I would advocate renting in an area before buying.
 
I agree wholeheartedly with Nordkapp.

A few other points; the value of the property relative to one's overall wealth needs to be right. These aren't investments per se, so their value shouldn't be too great relative to the overall pot. One also needs to be cognisant of service charges (plus other costs) and their affordability, particularly in retirement. Access is also key; will the flavour of the month which is accessible right now via (say) Ryanair remain accessible? That's why Faro and Malaga and their environs are so attractive. And it would be foolish to ignore the opportunity cost of having capital tied up in a holiday home; plus having a holiday home can compel you to keep returning to the same place and feel guilty about broadening your horizons and going elsewhere.
 
Gordon Gekko said:
Just to present an alternative view, a family place in somewhere like Portugal can be fantastic. My folks split their time between here and there so it's in constant use. We use the place a lot, and so do my siblings and their kids.
Click to expand...
Yes. I would not be purchasing it as an investment. Rather I would be purchasing it for both myself and my wife to enjoy and also for my children. I would not want to stop travelling to other places as well as we enjoy this so much.
I have some funds just sitting there. Earning me a miserable amount of interest. I do not want to invest in equities as I have been exiting them for a while now, hence the build up of surplus funds.
I like Spain and Portugal. I also agree with choosing an area close enough to one of the major airports and with good bus or train stations for onward transport. There does not appear to be any winter flights to Majorca. So Malaga and Faro do seem great. Alcudia is a possibility.
Nordkapp. Would you consider purchasing in one of your children's names?
 
See some previous posts from me pointing out the case against buying in Spain. When I posted back then the situation obtained per Noproblem's (excellent) post above. Property prices for good property in coastal Spain are on the way back, slowly but surely but nothing like the current property bubble in Ireland or the Spanish bubble ten years ago.

Let's cut to the chase here. Most people buying in Spain do so for investment reasons i.e. renting the property out when not in use by the owners or the family. Property is relatively cheap in Spain now and perhaps if you want to invest/gamble there has been no better time. Have a look at DoneDeal and you will see the amount of Irish people looking for and renting out their holiday home. I am one such person and I have got to say that last year and in 2017 finding renters has not been so easy in years.

If you are interested in buying then visit the area in the off season and ensure you're not buying in a ghost town (where everything shuts down between Oct - May). Employ a decent solicitor to act for you and nobody else and don't use an abogado (conveyancing official). By the way the off season rental market is almost entirely to retired people from the UK. Brexit will have a say here eventually if Brexit ever happens.

I have changed my mind from my previous posts on the matter. If you are not stupid, greedy or naive there are bargains to be had now and perhaps buying in Spain is a good investment?
 
I wouldn't like to always visit the same place. However, I do know a person who had a holiday place, but who swapped this on the holiday swap market for similar residences in all sorts of other places and who visited different places as a consequence. Of course you could just rent these places.
 
Leper said:
Most people buying in Spain do so for investment reasons
Click to expand...
Not always. My brother owns a property in Spain. He travels there every second month but not in July or August. He can keep in touch with family and friends and get his Irish bills etc dealt with when he returns to Ireland every second month.
He bought himself a small car that he can park near Malaga airport in secure parking for when he returns to Ireland.
His children and their friends can use it whenever.
He would spend a fair bit on flights but he plans these months ahead and because he is flexible in his arrangements he can get a good price. He has even arranged his own garden in Ireland so that there is no grass to cut. He loves it.
 
We bought an apartment in Portugal in 2013 not specifically as an investment but because we loved the area and had stayed in the complex on numerous occasions and had decided that if the opportunity ever arose to buy, we would. We rent it out to the complex for a set annual rent amount based on occupancy. The rental income provides enough to cover our local rates obligations and spending money for our visits there. We could probably earn higher rental income by letting it out privately but we didn't want the hassle etc. We would try and go there about 3 times a year and would hope to spend more time there in our retirement.... However, it doesn't stop us from going to other destinations on holiday. At the moment, some great value to be had on package deals if you are flexible to get up and go.
 
We have this discussion every weekend when watching 'A Place in the Sun..'. I would like to buy a small place in Spain but Mrs S says she would prefer to visit more places rather than be tied to one spot. I had flights booked in about 2007 to buy a 2 bed in Murcia for€118k. I faltered and cancelled the flights. Those same apartments are now on TV selling at about €40-50k. Phew! We have friends/family who own in Spain, Portugal and Turkey, who love their places but those places come with rose tinted sunglasses whereby they skate over the charges that arise in Spain/Portugal for water, electric, waste, pool and garden maintenance when required. There is also quite a criminal element who target holiday homes, so security is an issue. They would never admit they are a bit bored by their area of choice. Incidentally, one friend could not get out of Torrevieja fast enough and ended up buying in Portugal, for tax and other reasons. That area is now heavily marketed on A Place in the Sun. I couldn't commit such a proportion of my available capital(aka life savings) to a property abroad, much and all as I would like to.

Maybe if my Bank of Ireland shares recover to levels at which I bought them?..hmm...€30 per share!
 
This is something I've been thinking about for quite sometime now, though second home would be a better discription then a holiday home for me
But there is one issue that keeps raising it's head for me, its cheaper to rent then buy
Down in Almeria you can buy a county/village 2/3 bed house for about €50,000 but at the same time you can rent a similar house for 300/400 per month
So do you tie your money up or rent??
 
We should expect that in the medium term to long term, whenever governments finally decide that tackling our emissions substantially is necessary to meeting GHG targets, carbon taxes on air travel will increase significantly and air travel will become much more expensive relative to general inflation. Air travel is one of the worst forms of transport because of where the pollution occurs. This should mean that regular air travel becomes too expensive unless absolutely necessary. Things like this should be factored into long-term decisions like this.
Be interested to see if anyone sees this as a material risk to their investment in foreign property?
 
What prompted me to start this thread was the fact that the Government was reducing the prize fund for prize bonds. I have about €220k in prize bonds at the moment. I did a tot of my wins last night. About €1k in total for the year. A pretty poor return. I can expect this to be worse next year. I have shares in one UK. pharma company that is paying about £760 p.a in Dividends on a £16k investment. However I have had enough of the stock market and as I get older I am more interested in life's comforts than investing or gambling.

I would spend this on a second home in the sun. I have to take on board what Slim and Cervelo says above though.
I presently rent properties in Spain and Portugal. I usually travel in the months April/May and Sept/October. I pay somewhere between €400 and €500 per week plus a cleaning fee at the end of my stay. We really only need a one bed but sometimes I pay the extra for a two or three bed because the property looks good and is in a nice location. It is hassle free.

Would I spend the months of November to March abroad. I'm not sure.

Would I like all the bills/taxes/paperwork associated with ownership. I'm not sure.
 
Hi IsleOfMan, try a long stint and get a rent deal for 1 month or 2 months stay and weigh up the costs of renting, whether you could hack living in the same place etc.
 
Friends have units in Portugal, both rent these through UK sites and cover all costs plus some profit which almost covers their personal use costs, the similarity both properties have is that they are large 2 bed and 3 beds.
They are Condos in a managed development, pools, gym etc, I am thinking of jumping in as well, I think buy the best you can in a well run development and rental income should flow, condo fees are significant.
 
Last edited:
rob oyle said:
We should expect that in the medium term to long term, whenever governments finally decide that tackling our emissions substantially is necessary to meeting GHG targets, carbon taxes on air travel will increase significantly and air travel will become much more expensive relative to general inflation. Air travel is one of the worst forms of transport because of where the pollution occurs. This should mean that regular air travel becomes too expensive unless absolutely necessary. Things like this should be factored into long-term decisions like this.
Be interested to see if anyone sees this as a material risk to their investment in foreign property?
Click to expand...

while there are indeed many reasons to vote against buying a holiday home abroad , im really not sure id include this one , who knows what the future holds regarding anything but i think its very doubtful people end up travelling less by air in the next few decades
 
In my view there's a greater chance that new technology makes these places more accessible.

e.g. the Hyperloop (capsules travelling at ultra high speeds through tubes; interesting technology)
 
Interesting that the thread was started as a result in the reduction of Prize Bonds payouts. It shows people are again thinking of making a profit and suddenly the idea of buying a non Irish holiday home kicks in again. I invested in a holiday home in the south of Spain twelve years ago just before the recession. Back then the conversations among other foreign holiday home owners in Ireland were "Are you buying just the one property; we've bought two in Spain plus a holiday home in Mayo and another in Donegal." To be honest I was nearly sucked into buying a second property (greed). The rental markets back then were buoyant. The recession came fast and furious and suddenly many were left in negative equity (including me). There were some very lean rental years over the off seasons. But, things have picked up in coastal Spain and there are plenty of renters again, mostly retired people from the UK. This shows the importance of Brexit in the real scheme of things regarding property prices on the Costas. Very few purchasers got off lightly during the recession. Forget the twenty grand holiday homes, the resale chances are practically nil.

Cervelo made a good point above regarding such cheap rents winning over outlaying the bones of two hundred thousand euro. With very few exceptions don't fall for the "I just bought a Spanish holiday home just for the family holidays." The days of the Wild Irish are gone and Paddy now wants profit from somewhere. Spanish property will do.

TV programmes like Holiday Home in the Sun only whet the appetite for investors/gamblers. Anything you here on such programmes should be taken with a grain of salt. Some of the presenters and participants couldn't tell the truth if they had taken truth **************************.

Know the costs before you jump into buying anywhere. Community fees, waste collection, water charges, electricity costs, internet costs, local taxes, Spanish taxes, cleaning charges, maintenance, not to mention the percentages of real estate agents if you use one. So let nobody think the venture is fun only, and don't believe anything from somebody who says it is.
 
You must log in or register to reply here.
Back
Top