Interest in European property on the wane

Interest in European property investment has waned in recent weeks, as the strong euro takes its toll on overseas property aspirations.

Locations – including France and Spain – have seen interest flag by as much as 26 per cent, according to research by currency specialist HiFX.

In place of such markets, traditional emigration destinations have seen a strong resurgence in interest.

The number of buyers looking for a property in Australia, for example, increased by nine per cent during April, whole New Zealand also saw demand up eight per cent.

Furthermore, with prices down around 30 per cent in the last eight months alone, buyers are looking to capitalise on the weak dollar and purchase in America.

At present the pound buys $1.98 and €1.25.

"Sterling weakened significantly against the euro over recent months, reaching an all-time low of €1.2344 in April," explained Mark Bodega, director from HiFX.

"This has increased the cost of property for people buying in sterling.

"However, Spain has also been particularly badly hit, with talk of falling property prices, especially in the over supplied Costa regions, making new buyers wary of investing in the country."

Research has show transaction levels have been falling in the Spanish property market, while prices are also undergoing a sharp correction.

"Property prices in France seem relatively stable although British buyers are negotiating hard to make up for the inflated costs caused by the weak pound," continued Mr Bodega.

The HiFX Global Property Hotspots Report also reveals increasing interest in emerging markets such as Panama, Egypt and Brazil.

This new focus is driven by investors on the look out for the next property hotspot, rather than wannabe holiday home buyers.

Chris O'Toole