During the property boom of the early Noughties, second-home buyers were hungry for the next big location. But then came the global downturn, and everything changed. ‘A new world order of property ownership has been created,’ says Charles Weston Baker, head of international property at Savills. The ‘explorer buyer’ market has slowed, leading to a resurgence of areas where the property sector is mature.
France, especially the coast, is by far the most popular location to buy in. According to the most recent Savills Global Residential Review, published in 2010, the country saw property prices double between 2000 to 2007, fall back by 11% and then plateau. ‘Most of our enquiries are for France,’ says Mr Weston Baker. In particular, he adds, ‘the Saint-Tropez end of the Côte d’Azur continues to attract cash-rich lifestyle buyers, as it offers lower prices than the old [eastern] Riviera’. People are asking for favourites such as Saint-Tropez and Port Grimaud, or for the hilly charm of La Garde-Freinet, up in the Maures Mountains.
Manatee, USA – Riverside Mansion
‘Buyers tend to be people coming towards retirement,’ says Paddy Dring, head of Knight Frank’s international department. ‘They have enough funds to fulfil the dream of owning a house abroad, and want to enjoy more time with family. They have friends in these areas already.’ Mr Dring is selling a Provençal bastide at Mougins, with a pool and views to the Bay of Cannes and the mountains, at £4.827 million.
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By contrast, the market in the French interior, where people are often drawn to the sleepy pace of life reminiscent of pre-war rural England, is much quieter. Knight Frank associate Ian Purslow, of Purslow’s Gascony, sells restored farmhouses and says this is a good time to buy, but recovery will be slow. ‘The market remains saturated with properties that have little chance of selling if they’re overpriced, because they have to compete with new instructions.’ He believes the area is about halfway through a four- to five-year downturn. For example, he’s selling a five-bedroom former convent south of Auch at £494,580-three years ago, it would have cost £640,805.
€ 3.5m Villa Palmeiral, Algarve
The recession hasn’t doused British enthusiasm for Italy either. ‘The country has resisted the high mortgage culture that has landed so many others in trouble, so the housing market has been relatively strong,’ comments Mr Weston Baker. Demand from buyers remains particularly steady in Tuscany, where planning restrictions have prevented the region being flooded with new developments. People are most likely to buy a restored farmhouse in the hills of Chianti or Val d’Orcia, within reach of Florence and Siena. ‘A rescued farmhouse that’s ready to move into is what people want,’ says Rupert Fawcett, head of the Italian desk at Knight Frank. ‘Buyers are comforted by the knowledge that the market is more stable and feel they’re making a sound investment.’
A classic example is Le Prugnole in Val d’Orcia, a stone-and-tile farmhouse with five bedrooms, five bathrooms and swimming pool, which is on the market through Knight Frank at £2,580,420.
Buyers searching for security are also being drawn to niche locations with exclusive markets. One such is Venice, whose art, architecture and history hold an enduring appeal for buyers, even though properties for sale in the city are scarce and on the expensive side. A two-bedroom restored flat called Ca’San Sebastiano, close to a vaporetto stop in the Dorsoduro district, is being sold by Savills at £745,200.
€2.59m La Prugnole
Talking of islands, ‘people love Spetses’, in Greece, according to Mr Weston Baker. Part of the Saronic archipelago, just off the Greek mainland, it’s ‘absolutely magical’. Savills sell traditional villas there, built by ‘local builders who know where to find the best stonemasons’. Mr Weston Baker has Kaftani, which, although recently built, has antique floors and doors, as well as four bed-rooms, garden and pool, at £1,529,800.
Other upmarket niche locations, such as Monaco or Manhattan, remain popular with the very rich. ‘Global wealth is still looking for property,’ adds Mr Weston Baker. However, he warns, really expensive properties have a limited market. ‘People don’t usually spend more than half the price of the first home, or more than 10% of their net worth, on a second home.’
For Sale €1.35m Kaftani, Spetses
This is probably one of the reasons behind the revival of old haunts where the recession has softened formerly steep prices. Portugal’s Algarve has become more affordable, and buyers are flocking to the purpose-built resort of Quinta do Lago, where 800 acres of forests, world-class golf and golden beaches front the Atlantic. ‘We’ve had a number of sales at Quinta do Lago, which has been a surprise, as we haven’t had them elsewhere in Portugal,’ says Mr Weston Baker. ‘We think it’s because it’s so well established, with relaxed villas and wonderful management. It’s also very mature and has strong international appeal. Top-end prices have stayed the same, but, further down the scale, they are 10% to 20% off peak.’
Similarly, Florida’s southern tip, close to the Everglades and along the Keys, is also a safe-and newly affordable-choice. ‘Some discerning buyers who thought of the Caribbean but wanted somewhere more stable, have bought here,’ says Mr Weston Baker. ‘One chap sold his electronics firm for £100 million and bought a lovely house in Palm Beach. Prices are 30% to 40% lower than at the peak.’ Savills is selling a Manatee riverside mansion in Sarasota that has a deep-water dock, in-law suite, three other guest suites, poolside grill, television and outdoor fireplace, for £2.35 million.
The recession hasn’t just affected buyers’ preferences for certain destinations. People have also become more cautious when it comes to purchasing off-plan. ‘They want established projects. They want sight of things being delivered because, a few years ago, a lot of projects began to stall,’ explains James Price, head of residential international development at Knight Frank. For example, at Porto Montenegro, a glamorous marina project on the Adriatic sea, developers are offering residences with berths and have continued to sell to yacht owners around the world. Prices range from £487,243 to £850,456.
In the Bahamas, a region where a huge number of projects stalled, the developers of The Albany have continued to build spectacular apartments to maintain momentum. Beach-club cottages start at £2,473,048. Another one to watch on Mr Price’s books is PGA Catalunya, north of Barcelona, where world-class golf courses and a sense of style have attracted buyers. Plots start at £324,770 and villa constructions at £508,590. The buzz here is different to the rest of Spain. ‘It’s close to beaches and mountains for skiing,’ he says.
Purslow’s Gascony 00 33 5 62 67 61 50; www.purslows-gascony.com
Savills 020-7016 3740; www.savills.com/abroad
Knight Frank 020-7861 1057; www.knightfrank.co.uk/international-property or contact firstname.lastname@example.org for new developments