| The call for new taxes on flights to reduce | | | | apartments and villas declines, quite a few |
| carbon emissions could impact the prices of | | | | will need to sell as the rental income pays |
| properties, according to a UK based overseas | | | | the mortgage. There could be a glut of |
| property company. | | | | properties come to the market which will send |
| | | | prices downwards.' |
| 'There has been more discussion and calls for | | | | |
| action recently over the impact that air | | | | Exceptions to the rule could be in the two |
| travel is having on the environment,' they | | | | European tax havens of Monaco and Andorra, |
| say, 'And one of the most obvious ways to cut | | | | where there is no income tax for residents. |
| air travel is to raise the price of | | | | |
| travelling through taxes. It's a win-win | | | | 'Historically tax havens have been popular no |
| situation for governments, more tax revenue | | | | matter how the economy is. When someone buys |
| and being seen combating global warming at | | | | a property in Monaco it often doesn't matter |
| the same time. It's only a matter of time | | | | to them if it's a few million Euros as |
| before cheap air fares on the scale we see it | | | | they're going to save more than that in tax |
| today comes to an end'. | | | | during the time they stay there. Andorra is |
| | | | slightly different as it's a tax haven but |
| Owning a second home and a property abroad | | | | also people buy ski apartments there, adding |
| has shown to be an aspiration for the | | | | to demand'. |
| majority of UK residents by recent surveys, | | | | |
| and low cost carriers have opened up new | | | | Andorra property prices have risen an average |
| overseas property markets by flying to | | | | of ten per cent a year in the last decade, |
| destinations not covered by other airlines, | | | | and some predictions are for that figure to |
| or forcing flight prices down where they | | | | be closer to fifteen per cent for 2006. |
| compete directly with more established | | | | |
| carriers. | | | | If governments do start introducing new air |
| | | | fare taxes to slow and possibly reverse the |
| Property prices within a one hour drive of | | | | rise in air travel there could be good news |
| regional airports served by the low cost | | | | for some property buyers though. |
| airlines have tended to escalate in recent | | | | |
| years, and it is these areas that would be | | | | 'In some areas the second home market has |
| hardest hit by any increased taxes on flying. | | | | increased prices significantly, with many of |
| | | | the younger local population being forced to |
| The areas which would feel least impact would | | | | move away from their towns and villages. |
| be northern France, which many UK second home | | | | |
| owners access via ferry and the Channel | | | | The UK and US populations are quite mobile, |
| Tunnel, and areas where owning a property | | | | but in some countries popular with holiday |
| abroad was in vogue long before the new | | | | home buyers there are three or four |
| airlines started, and when air fares were | | | | generations of the same family in a village |
| proportionately higher than they are today. | | | | or town. But as overseas property buyers have |
| Access to France from the UK has improved | | | | moved in and pushed prices up, the younger |
| recently with Eurotunnel cutting the journey | | | | generations ahave been forced to look away |
| time by twenty minutes. | | | | from these popular areas because they cannot |
| | | | afford a property in their home town anymore, |
| 'The Costa del Sol for example we feel | | | | and a lot of the local employment has become |
| wouldn't be impacted much by increased air | | | | seasonal. If real estate prices come down |
| taxes - although over development could bring | | | | they might be able to afford to live in the |
| prices down there anyway'. | | | | villages where they were brought up if they |
| | | | choose to do so. Some will still move away |
| But there is a warning that the lower priced | | | | but at least they will have a choice.' |
| end of the market could be hit more than the | | | | |
| top end. | | | | Conversely, far from changing traditional |
| | | | towns and villages into holiday resorts, |
| Bargain Properties | | | | overseas property buyers can sometimes have a |
| | | | positive affect on preserving traditional |
| 'There has been a significant increase in | | | | village life. |
| second home ownership in the last decade', | | | | |
| say the company. 'Gone are the days when it | | | | 'In France for example, many of the rural |
| was just the wealthy who owned an overseas | | | | villages were dying a slow death as the |
| property. Developers in Spain, Greece and | | | | younger generations moved away to the bigger |
| Cyprus have built apartment blocks with units | | | | towns and cities to find work. British second |
| of two and three bedrooms that are affordable | | | | home buyers have revived the villages by |
| for a lot of middle income families. Given | | | | buying run down properties and renovated |
| that mortgages are readily available and it's | | | | them, breathing new life into the |
| often just twenty per cent of the asking | | | | communities. The property market is nothing |
| price that needs to be found an overseas home | | | | if it isn't adaptable,' they conclude, 'And |
| has become reality for millions of Europeans. | | | | while there will be regions that will suffer |
| But if air fares increase significantly and | | | | as a result of a declining market, there will |
| the holiday makers who rent the owners | | | | be winners too. |