The Royal Institution of Chartered Surveyors’ (RICS) survey of European housing markets suggested the value of property across Europe was likely to drop this year.
UK residents with property overseas are likely to see the value of their second homes fall, with almost all countries suffering either a sharp drop in house price inflation or actual falls last year.
The largest drop was in Ireland where a fall of 7 per cent was experienced. Greece, Germany and Denmark also experienced sharp falls.
Professor Michael Ball, from the Department of Real Estate and Planning at Reading University, said: “Economic growth in 2007 was strong and growth rates for 2008 in the eurozone are forecast to lie within the range of 1.5 per cent and 2.5 per cent and to be strong elsewhere in Europe as well.
“The risk of a sharp downturn in economies, though ever present, is small. So, the combination of markedly higher interest rates and a sudden, sharp recession, which last sent Europe’s housing markets tumbling in the early 1990s, is still remote.”
Meanwhile, Natwest International has confirmed it is to branch into the French and Portuguese markets by the end of the year. Buoyed by broker and consumer interest, the lending institution stated that it hoped to launch into the markets in Autumn.
Darren Fretwell, head of UK sales at Natwest International Mortgages, admitted that in the current climate the overseas sector could provide an additional and welcome income stream but admitted that broker knowledge of the market was currently ‘under-utilised’.
He said: “With the French and Portuguese offering, we will be widening our scope, and has come because our customers and brokers wanted it.
At the moment, take-up is still relatively slow among brokers, but it is an easy market to get involved in. We guide brokers along the way with any queries they have and the proc fee and additional fees they receive from cross-selling opportunities make it a market set for growth.”