Florida builders got a bit of good news this week. A new study reports that British and Irish citizens now own nearly 4 million properties overseas -- worth nearly $90 million -- and the market is forecast to grow at an annual rate of more than 13 percent between now and 2012.
The study, the largest of its kind ever done in Britain and Ireland, was performed between June and September by business research firm Datamonitor on behalf of Overseas Property Professional magazine; the results were announced on Tuesday in London at OPPLive, a trade conference for professionals in the sale and marketing of overseas properties.
Spain, France, and the U.S. continue to be the three most popular destinations for British and Irish buyers, with Florida being their overwhelming favorite location in America.
"Spain was the first cheap overseas holiday destination that opened up to British consumers in the 1960s; Florida holds a similar position in the hearts of British travelers," says Neil Hendry, director of consulting for Datamonitor. "You can get three or four-bedroom apartments in Florida for $250,000. That's pretty phenomenal. It's a fairly attractive proposition."
Other popular locations for British and Irish buyers include Cyprus, Greece, Canada, and Australia. Younger, more adventurous buyers also are snapping up properties in Bulgaria, Croatia, Egypt, and India.
The study was based on surveys with more than 4,000 British consumers who had purchased property, were in the process of buying, or had gone through the process and opted not to purchase. They also interviewed 900 estate agents and property developers.
That information was used to create a market-sizing model for the next five years, to analyze the top 30 destinations, and to identify the kind of activities agents were performing, such as listing properties and arranging financing.
For buyers who started the purchase process and opted not to go forward, the decision was based on one of five reasons, Hendry says: lack of funds to complete the transaction, difficulty finding employment if they were looking to move overseas permanently, fear of making the wrong choice, fear of missing their families by moving overseas, and lack of trust in health care.
Buying for lifestyle
Some other welcome news for builders about U.K. buyers -- they're buying houses for pleasure and they're likely to pay cash. More than 70 percent of the survey respondents said they bought a property to improve their lifestyle, as opposed to looking for a big return on investment.
"The payback for the person is the time they get to spend there, experiencing a new life," Hendry says. "It transcends the monetary value. It's a decision driven by the heart rather than the head."
One of the key reasons Datamonitor is bullish on the market continuing to grow, Hendry says, is that more than 70 percent of the respondents said they paid cash for their overseas homes, rather than taking out a second mortgage or a home equity line. That's especially helpful given the tight credit market in the U.S.
Learn more about markets featured in this article: Orlando, FL.