Budget Airlines & Holiday Property Prices in Europe

The rise of the budget 'low-cost' airlines has opened up huge opportunities for Europeans to travel around the continent very economically. The availability of cheap flights has also helped fuel the holiday properties and real estate market considerably over the last few years.

The number of destinations served by low-cost airlines has exploded and those living in northern Europe have many different choices for short breaks and holidays. Many have taken the plunge by investing in a second property overseas.

This phenomenon has been most marked in the UK and Ireland where house prices rose massively from the mid 1990s. Many UK homeowners took equity out of their existing homes by re-mortgaging to buy that dream holiday appartment or villa in the sun - mostly in France, Spain, Portugal and Italy.

Tens of thousands invested in a holiday home abroad to take advantage of lower property prices and lower mortgage rates in continental Europe.

Cheap Flights means Easy Access

One of the key considerations has been getting cheap and convenient access to your property. Is your potential holiday home town or city served by a low-cost airline? This offers you the chance to visit your property multiple times during the year at an affordable rate. In the old days one was faced with a very long drive or having to pay up big time for an airline ticket on one of the major carriers.

The budget carriers such as Ryanair and Easyjet are very well established in Spain, France and Italy, the traditional holiday centres. Whenever the budget airlines started a new route real estate prices tended to increase soon after as the flood of property seekers entered the market.

Newer budget airline routes to the Baltic states, Morocco, Turkey, Croatia and Bulgaria in the last couple of years have brought property speculators further afield and price rises have been very good.

Future Uncertainty

However with the current sub-prime mortgage fiasco it seems the holiday property market could slow down in 2008. European interest rates are set to rise and the British pound will likely depreciate. Some housing market hotspots like Spain are due for a correction. And the high price of oil is putting severe pressure on airlines. So think carefully before making an investment.

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