Is Brexit really affecting transactions in Marbella?
Is Brexit really affecting
transactions in Marbella?After so much discussion in the lead up to Brexit and the subsequent negotiations, the question remains: how much is it affecting interaction and investment between the UK and EU countries? In this article, we look at the impact of Brexit on property sales in Marbella.
The British market has been important to the Costa del Sol from the earliest days in its development as an international luxury destination, back in the 1960s. It was, however, with the abolition of the exchange controls by Margaret Thatcher’s government in 1979 that British buyers were truly given free rein to acquire homes abroad – and they did so in numbers, rapidly becoming the largest source of foreign property buyers in markets such as Marbella.
By the 1980s, British buyers were therefore established as the number one market and primary target of marketing efforts both for tourism and the purchase of holiday homes, though gradually a growing number of UK citizens also chose to retire to the sunnier and more affordable Spanish Costas. By the time the property boom of the 2000s arrived, the Brits alone accounted in some cases for over 50% of all foreign sales.
The British market has been important to the Costa del Sol from the earliest days in its development as an international luxury destination, back in the 1960s. It was, however, with the abolition of the exchange controls by Margaret Thatcher’s government in 1979 that British buyers were truly given free rein to acquire homes abroad – and they did so in numbers, rapidly becoming the largest source of foreign property buyers in markets such as Marbella.
By the 1980s, British buyers were therefore established as the number one market and primary target of marketing efforts both for tourism and the purchase of holiday homes, though gradually a growing number of UK citizens also chose to retire to the sunnier and more affordable Spanish Costas. By the time the property boom of the 2000s arrived, the Brits alone accounted in some cases for over 50% of all foreign sales.
Brexit
Brexit was of course preceded by the Financial Crisis of 2008, when global housing markets and economies were profoundly affected by the largest crash since 1929. The British market was, however, one of the first to recover, as not being part of the Euro Zone (but still part of the EU back then), the UK had an independent central bank that followed American quantitative easing much sooner than Europe, allowing it to also bounce back sooner.
However, where British buyers had formed the backbone of the foreign property buying market in Spain for decades, the picture began to change. Brits continued to form the largest single group of buyers, but dropped to around 20% of the total, with Scandinavian, Belgian and French home seekers closing in. This process accelerated after the Brexit referendum of 2016, and despite some strong rallies the focus of the foreign market for Spanish property shifted from the UK to Scandinavia and Belgium.
However, where British buyers had formed the backbone of the foreign property buying market in Spain for decades, the picture began to change. Brits continued to form the largest single group of buyers, but dropped to around 20% of the total, with Scandinavian, Belgian and French home seekers closing in. This process accelerated after the Brexit referendum of 2016, and despite some strong rallies the focus of the foreign market for Spanish property shifted from the UK to Scandinavia and Belgium.
The years of uncertainty during protracted negotiations took their toll, but the British never disappeared, and began returning in numbers after the Covid lockdowns, driven by the same reactions to confinement that affected people from other nations—choosing Marbella in record numbers during 2021.
It resulted in a fantastic year for Marbella real estate, especially in the upper segments, and though they are now in among buyers from other parts of Europe and their overall share has fallen to around 10%, British demand for Costa del Sol homes and lifestyle is undergoing a renaissance, rising by 71% over 2020 and 13% over 2018 – underscoring the fact that the longstanding relationship between the UK and the Spanish Costas is an enduring one.
It resulted in a fantastic year for Marbella real estate, especially in the upper segments, and though they are now in among buyers from other parts of Europe and their overall share has fallen to around 10%, British demand for Costa del Sol homes and lifestyle is undergoing a renaissance, rising by 71% over 2020 and 13% over 2018 – underscoring the fact that the longstanding relationship between the UK and the Spanish Costas is an enduring one.