Brexit spells UK end to Spanish holiday home dreams

Londoner Joanne Connor may sell her holiday home in southern Spain as a falling currency drives up the cost in pounds of her household bills and mortgage payments following the UK’s decision to leave the EU.

“The cost of living in Spain has shot up for us overnight,” the 39-year-old mother of two from London said.

“If the pound stays this low or continues to drop we will end up having to sell.”

Sales in some coastal areas of Spain could tumble as much as 20% in the next 18 months as a sliding pound erodes the spending power of British buyers and owners following the vote to leave the EU, according to Aura Real Estate Experts.

Britons make up the largest contingent of overseas home buyers in Spain.

Ms. Connor has to change pounds into euro to meet the €400 a month mortgage payments on the two-bedroom home.

The 9% decline in the pound’s value against the euro since the Brexit vote will limit her visits to Spain to just one this year, compared with six times in previous years.

“It’s not just the mortgage which is now more expensive; it’s the car hire, the utility bills, food,” Ms Connor said.

She purchased her Spanish property in 2005 for €120,000 and says it may now be worth €75,000.

UK citizens represented 21% of the 46,090 purchases made by overseas buyers last year.

Foreign buyers made up 13% of all Spanish house purchases in 2015.

In Murcia and Andalusia, Britons account for 54% and 29% of transactions by foreigners respectively.

“We had 10 would-be buyers and two have put their plans on hold after Brexit,” said Mary Arro of Mia Property Boutique in Alicante.

In the municipalities of Benitachell in Alicante and Benahavis in Malaga, sales could drop by around 20%.

The firm also identified 15 other towns where sales are expected to fall as much as 17% over the same period.

Marbella-based real estate broker Prime Invest, said home sales to British buyers had already slowed “noticeably” before June but are now “totally paralysed”.