05 Mar 2008 12:00 AM:
The baby boomer generation is now coming up to retirement or if they are lucky already retired. The majority of the wealth in the UK is held by this older generation and as such there is more investment in overseas off plan property than ever before.
In the past many Britons have spent their retirement in the UK and have taken long holidays to compensate for the cold, dreary weather in the winter. However, an ever growing number of people are now looking to spend part or all of the year abroad in second homes in search of a better climate and more relaxed lifestyle. In an article yesterday in the Independent, the government stated that ‘871,000 Britons now draw their state pension while living permanently overseas’, whilst Msn money reported that roughly ‘1 million US retirees currently live abroad’. A recent report predicted that by 2010, 1 in 8 over 55’s in Britain will choose to live abroad and goes on to predict 1 in 5 will be living overseas by 2020, all escaping high crime, high stress and high prices.
Secure gated retirement complexes/villages are springing up in parts of Europe and further afield and they are becoming an increasingly popular property choice. These ‘third age’ resorts offer extra onsite facilities such as 24 hr call out service offering peace of mind, exemplary medical and healthcare facilities and fun social zones to keep active with sports or meeting like-minded individuals. Moving abroad has never been easier or more accessible with numerous low cost airlines serving a variety of new destinations as well as more and more cheap flights to favourite locations. Much of Europe is only a few hours flight away, which makes it an attractive place to buy a second property. The cost of real estate compared to the UK is still generally lower and means that you can potentially get a lot more bricks and mortar for your money.
Weather is a big driver in people’s decision to buy a retirement property abroad, heading south like birds to find warmer climes. Don’t be fooled however, by the 320 days of sunshine nonsense, it simply isn’t true. Southern Spain drops to 5 degrees with snow in the mountains in and around Granada. In most of Europe winter time weather is unpredictable, but the average temperatures are higher the further South you go. This is something to bear in mind if you want to use your property in say Dec/Jan, Sunny Beach might not be quite so sunny!
Many reports suggest that a Mediterranean diet and slower pace of life have significant health benefits, with rates of heart disease in the UK much higher than that of Spain, France, Italy and Greece. In many retirement resorts the sense of community is great with people from all over Europe socialising and building life-long relationships.
It’s not all sun, sand and socialising though, you have to answer some serious questions before taking the decision to move lock, stock and barrel to a new country. Ask yourselves the following questions if you are thinking to buy invest abroad for your retirement:
What happens if your partner falls ill? Think about language problems, health insurance and decision legalities.
Do you have the right insurance and what are your rights for healthcare as a resident in the country?
Do you understand the legal system and how to buy property?
What are the costs of buying abroad, what are the HIDDEN ongoing costs? Some retirement resorts charge higher community payments to cover the increased service offerings.
What happens to your pension payment if you buy abroad? Check the currency exchange rates it may work out better to receive it in your country of origin and exchange in batches.
What are your tax liabilities as becoming non-resident in your country of origin?
Pensions?
Inheritance, what happens to your estate should the worst happen? In Spain, it is important to get a new will as it’s inheritance laws are different to the UK.
Country rules can vary greatly, so it important to find out the answer to all questions. Don’t assume anything.
** EDITED ** Commercial post
This message was last edited by EOS Team on 3/5/2008.
Forum thread:
RETIREMENT TO SPAIN
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