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Revealed: the best countries to buy property abroad in 2019

Find out which countries' property values are on the rise

Buying a holiday home, or looking abroad to beat the UK housing market? New research has revealed the countries experiencing the highest growth, where you’ll get more bang for your property buck.

Property values have increased the most in Hong Kong, analysis from Knight Frank has revealed, followed by Malta and countries in Eastern Europe.

The property consultancy’s global house price index also shows that, of the 57 countries being tracked, property in Saudi Arabia is losing value at the highest rate.

Which? explains which other countries are proving to be a good holiday home investment, and what is involved when buying a property overseas.

Where will buying property abroad see the most growth?

The table below shows the countries with the highest annual percentage change over the last 12 months.

Country 12-month percentage change Six-month percentage change
Hong Kong* 15.7% 7.8%
Malta** 15.7% 4.6%
Slovenia 13.4% 8.8%
Lithuania 11.5% 4.3%
Hungary 10.5% 5.6%

*Provisional. **Asking prices. Source: Knight Frank Global House Price Index Q3 2018

As the table shows, over the last 12 months, property value in Hong Kong has increased by 15.7% over the last 12 months – which is a huge increase.

If you’d bought a £100,000 property in Hong Kong 12 months ago, it might well be worth £115,700 now.

There is a marked difference to the five countries with the lowest percentage change.

Country 12-month percentage change Six-month percentage change
Ukraine -0.7% 1.3%
Israel -0.7% 0.5%
Sweden* -1.4% 0.5%
Finland -1.4% -0.5%
Saudi Arabia -3.7% -2.9%

*Provisional. Source: Knight Frank Global House Price Index Q3 2018

Property investments Saudi Arabia have lost -3.7% value in the last 12 months, along with parts of Scandanavia.

The UK sits towards the bottom of the table at 35th place out of 75, with a 12-month percentage increase of 3.5%.

Other factors to consider

This, of course, only gives an overall idea of a country’s property market – there’ll always be fluctuations between regions, and across the year.

For instance, while Hong Kong is in the top position for growth, it’s visibly slowing down with a much-reduced figure over six months. And in the last three months, there’s only been 2.3% change.

There are also many other factors to consider before buying a property abroad – such as living expenses, tax liabilities you’ll face (both abroad and in the UK), and the political and economic stability in the local market.

You’ll also have to consider the fact that you’re likely to pay a premium if you opt for the more tourist-friendly locations.

For instance, if you were to buy a property in Malta – the European country where property value is increasing at the highest rate – a holiday home in the bustling capital city of Valletta would likely command a higher price than the small central village of Lija.


Will Brexit have an impact on buying overseas?

If you opt to buy a property in an EU country, there’s a chance Brexit could affect your purchase.

While we’re still waiting to see whether a deal can be reached, or what a no-deal Brexit will actually mean, it’s all still an unknown.

No one can say precisely how overseas mortgages might be affected – if at all – but it’s something to bear in mind.

If you’re thinking of remortgaging to pay for a holiday home, we’ve looked at the ramifications that Brexit uncertainty is having on the UK housing market, as well as asking experts in the field for their views.

What happens when you buy property abroad?

If you want to buy a home abroad, you’ll need to get an overseas mortgage.

All of the main UK high street banks offer overseas mortgages, but they only tend to operate in countries where they have offices.

Even if you opt to use a UK bank to help arrange an overseas mortgage, you might have to deal with a foreign arm of the bank once the mortgage is in place.

Alternatively, you could opt to deal with a local bank in the country you’re buying in with the help of a specialist mortgage broker.

Some overseas rates are far lower than the UK, but bear in mind that overseas brokers aren’t covered by the Financial Conduct Authority, so you might not be able to get compensation if you’re given poor advice.

There can also be risks when borrowing in a foreign currency, as exchange rate fluctuations could increase the cost of your loan.

Some countries may also require a higher deposit – for example, in Spain overseas buyers are expected to provide 30% to 40% of the property price.

With this in mind, it’s vital to get expert advice from a specialist broker and a property lawyer.

Get expert advice on remortgaging to fund an overseas property

While the team at Which? Mortgage Advisers cannot advise you on overseas mortgages, they can provide expert help if you’d like help to remortgage your UK property to release cash to buy overseas.

To chat with the friendly team about your remortgaging options, call Which? Mortgage Advisers on 0800 197 8461 or fill in the form below for a free callback.

Your home may be repossessed if you do not keep up repayments on your mortgage.

Which? Limited is an Introducer Appointed Representative of Which? Financial Services Limited, which is authorised and regulated by the Financial Conduct Authority (FRN 527029). Which? Mortgage Advisers and Which? Money Compare are trading names of Which? Financial Services Limited.

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