The referendum made last week quite an historic week. Since then nothing has changed but understandably people who own property in the EU or are planning to buy have questions about the possible impact of the result on their lifestyle.
This is what we know so far.
Nothing changes for two years from when the UK informs the EU we plan to leave for which there is currently no fixed date, nor can the EU force the British government to trigger this notice. During this period we remain a fully paid-up member of the EU with all our rights and privileges intact.
If you are currently resident in another EU country or plan to become so in the next two years, when the UK does leave it is highly likely you will retain the rights you have acquired to reside in that country. While the host country is under no obligation to provide services such as healthcare, it is again likely the UK will reach an agreement with other EU countries for a reciprocal arrangement as it would be in the interests of the EU to look after their citizens given the 3 million EU nationals in the UK and only 1.3 million Brits living across Europe.
British buyers make up a significant portion of the property market in many countries – in Spain they account for one in five of all overseas buyers – and several countries are desperate to attract Brits to buy property and help boost local economies. Many towns in regional France are reliant upon British owners bringing their pensions to spend in local businesses.
If you are currently planning to buy a holiday home in the EU then you are likely to be keeping a close eye on the exchange rate. Currently at 1.2 Euros to the pound, Sterling has not collapsed and still makes overseas property in most areas very good value. If your view is this rate may worsen then you can speak to a specialist currency broker and forward fix the rate you get.
What this means is you agree a rate now for a transaction further down the line, protecting you from any drop in the value of Sterling (this mechanism also means you don’t benefit if Sterling improves). Contact now >
Planning to live in the EU on a UK pension post-Brexit will mean regular payments from the UK are open to currency fluctuations if you do not choose to forward fix the rate at which you buy. A British pension would not attract any inflation-increase as it would if we had remained in the EU, representing a marginal loss.
Post Brexit it would be possible for a country to impose additional or higher taxes on British owners, for example on a house sale, because the basic right for a Brit on the Algarve to enjoy the same tax treatment as a Portuguese national will have been lost (though in the case of Portugal anyone spending half the year there can join the non-habitual residency scheme and enjoysignificant tax breaks). What is unlikely is that an EU country would impose anything overly-draconian that would deter British buyers.
We believe the appetite for Brits to own property in the EU and around the world remains unchanged, it could get more expensive and slightly more complicated than had we stayed in the EU but there are no restrictions on non-EU nationals Brad and Angelina buying in Mallorca and there will be no restrictions on you.
We will have more information on aplaceinthesun.com in due course and our autumn exhibitions at the NEC Birmingham 23rd -25th September and the SECC Glasgow 29th – 30th October will include specialist sessions on Brexit and property with experts on hand to address your individual questions.