Figures showing exactly how many Brits bought overseas last year – and where they bought – are now out and the numbers are huge.

According to the Association of International Property Professionals (the AIPP), a total of 193,600 Brits bought property in the top ten most popular countries listed below. Spain is still by far the most popular country to buy in with more than 20,000 investing in property there, compared with France which is the second most popular country.

Despite the early indications of a downturn in many of the world’s property markets last year, our research shows that, with the exception of the USA, house prices in 2007 were still growing even if this growth was slowing. The picture for the 2008 statistics is likely to be less rosy. Paul Owen, chief executive of the AIPP, believes that we’ll still be buying overseas in the coming year, but we’ll head for the markets we know best. “In the difficult times which we are now in, people tend to settle on the safer and more established countries, and I think that will continue next year,” he says.

So which are the top ten countries attracting British buyers?

Number one: Spain
Clearly the Spanish market has experienced a sharp downturn, with prices are now falling in parts of the Costa de Sol, Mallorca and Barcelona. According to the API, the industry body for estate agents, 50 per cent of its members in Spain quit in 2007. Not all of the country is experiencing price falls though, and one person’s misery is another’s chance to snap up a bargain provided you do your research, choose carefully and take a long-term view.

Number two: France
The figure of growth for 2007 is the lowest increase since 1998, but long-term prospects are good. The British are the biggest foreign buyers in the country – accounting for 60 per cent of all non-French buyers – and, more recently, Russians have been buying there too, mainly in the Côte D’Azur. Considered one of the safest markets in which to buy a holiday home and likely to narrow the gap with Spain in terms of popularity in 2008.

Number three: USA
Desperation has hit parts of the USA – repossessions are up, developments have been halted mid-build and sellers can’t shift their properties in some areas. Most analysts agree that the bottom of the fall is not yet in sight. Some of the hardest hit areas are those traditionally popular with British buyers, including Florida and California. Miami, Phoenix, Los Angeles, San Diego and San Francisco are faring badly too. On the upside, the dollar is weak so you get lots for your money. Developers are desperately wooing foreign buyers, so British buyers prepared to bargain very hard may do well.

Number four: Bulgaria
Surprisingly, Bulgaria was recently ranked number one in Knight Frank’s latest Global Price Index with a whopping 32.3 per cent rise. Much of this growth has been seen in the capital Sofia, where prices started at a low base. The whole country isn’t faring as well though. Knight Frank’s report highlights issues of oversupply in the Black Sea coastal areas, where it is reported sellers are having problems shifting properties. Early reports of capital growth in the first quarter of 2008 show growth has slowed but is still high at 15.21 per cent. Bulgaria is attracting retirees who are making the most of the lowest costs of living in Europe and finding their British pension goes a long way.

Number five: Morocco
It is hard to get accurate house price figures for Morocco, but all the signs are looking good. Rental yields are high in Marrakesh and a burgeoning tourist market boosted by low-cost airlines flying to the north-African country is bound to boost its property market. The French are the biggest foreign buyers in the country, but British buyers are growing. So far, most British activity has focused on Marrakesh and the historical Fez.

Number six: Dubai
Those that thought the price growth in Dubai couldn’t last have so far been proved wrong. Massive foreign population growth – including large number of Brits and Australians attracted by a growing economy unaffected by the credit crunch and low taxes - and limited supply of built apartments and villas has meant, so far, that demand far exceeds supply. The issue is the infrastructure: can Dubai’s power plants and roads keep up with such rampant building – and will there be an oversupply in the future, when the millions of apartments being built are finally completed?

Number seven: Italy
House prices have been steadily growing since 1997. The main property buying areas are the heavily protected Tuscany, Umbria, and Puglia, Liguria and the Northern Lakes. Attractive property is still relatively cheap in Italy (on average cheaper per sq m than Morocco, for example), particularly in the south of the country and in Abruzzo. Rental yields are low due to high taxes on rental income that range from 23 to 43 per cent.

Number eight: Portugal
2006 saw an increase of six per cent, but in 2007 prices have stagnated. Agents are drawing our attention to government reforms and a tourism push as a reason why the market won’t suffer too badly in the near future. The rental market in Portugal is taxed relatively heavily and the laws, despite being recently changed, are still considered to be balanced in favour of those renting.

Number nine: Cyprus
After years of gradual growth in Cyprus, the past 18-months have seen a property boom. The British have been buying on the southern half of Cyprus - especially near Paphos - for 20 to 30 years, but the past two years have seen them moving further afield. Prices are considerably cheaper than in Spain. Initially favoured for its cheap property, Cyprus is trying to promote itself as a more up market destination to buy, with marinas and luxury hotels being built. Community leaders in the Greek south of the island and the Turkish north recently met and agreed to try to resolve the conflict that has divided the country since the 1970s - something that bodes well for the future of the property market.

Number 10: Turkey
The Turkish economy is going great guns – averaging six per cent from 2002 to 2007, one of the highest sustained rates of growth in the world. Young families and retirees are also buying here, partly because it’s still cheap: you can buy flats for £40,000, with reliable sunny weather. Terrorism and a tense political climate, with Islamists trying to overturn Turkey’s secular constitution, are a concern to some buyers.

see also

Search: Find your dream overseas property

News: Read more about the Knight Frank property prices report

On the web: Learn more about the UK housing market with Channel 4's 4Homes

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