Brexit British buyers Spain | The UK’s decision to leave the European Union with a “Hard Brexit” blueprint of 12 key negotiating points provides some interim answers for prospective property buyers in Spain.
The points include the future status of 3.3m EU residents in Spain and that of 2.1m UK passport holders living in the EU – 25% of them in Spain. The Brexit Blueprint, revealed by Prime Minister Theresa May, suggested there should be no change.
It seems the majority of European Union countries have already indicated they were ready to do a “reciprocal rights” deal very soon that would see British expats granted the right to carry on living in European countries after Brexit. EU nationals already living in the UK at the time of Brexit would almost certainly have individual “acquired rights” under the 1969 Vienna Convention, which means they can stay and be welcome
Can I still buy a property in Spain?
Yes, of course. Britain is still a member of the EU and British citizens enjoy the same rights. Brits can buy property in the expected two years of negotiation before Brexit and safeguard their future with the same “acquired rights”. Spanish banks have properties that are averaging peak to present discounts of 44% – some with 100% mortgages.
What will happen to my property when the UK leaves?
British buyers are Spain’s biggest customers and now account for 1 in 4 house sales which generates millions of jobs. This level of inward investment is too important for their economy. Non-EU buyers are extremely active in the market and enjoy very similar rights to EU nationals. Brexit is unlikely to impact the rights of British citizens to buy property in Spain and to enjoy full Spanish residency rights and usage thereafter.
Will I get a mortgage?
Yes. Spanish banks typically ask foreign buyers for a deposit of up to 30%-40% and that seems to provide them with the right level of protection. Spain’s biggest bank, Caixabank, has just launched the Holabank, subsidiary to serve the English speaking buyer market. Meanwhile, the economic climate in Europe is locked into low interest rates ensuring borrowing costs remain good value.
Will the Spanish property market crash?
British buyers are important to the Spanish market and they are the largest single nationality among overseas investors. However to put this in context, Brits form 4%-5% of the market.
Brexit is highly unlikely to trigger a crash because foreign buyers are an active and growing part of the market. Even a complete collapse in UK demand (totally unlikely) would only put a small dent in the market that, while growing slowly is a long way off its 2007 peak.