We’re entering into a critical period for property buyers – including anyone looking for a ski property – and that’s not just because of restrictions from the coronavirus pandemic. For many people, Brexit trade talks may have slipped off the radar, but there are key deadlines coming up fast. Here’s what you need to know and how it may affect your purchase.
Clock ticks down on Brexit negotiations
The UK is still in the Brexit transition period, which currently runs until 31st December 2020, to give the time for trade negotiations, among other things, to be completed. While the negotiations have been continuing via video conference during the pandemic, however, they have made little progress. Both parties appear to be waiting for the other to ‘blink first’.
If it looks like a trade deal is unlikely to be reached this year, the British government does have an option to extend the transition period, but must do so by 30th June. So far, all indications point to no request for an extension, meaning that it will be very likely that the two trading partners will return to World Trade Organisation terms on 1st January 2021.
That means the next five weeks will be crucial for anyone looking to purchase a ski property from the UK. The currency markets will be deeply on edge for what happens, and will likely see significant movement when the final decision is made. If you’re planning on buying this year, and don’t want to have your purchasing power reduced by potentially thousands due to a reduced pound, it’s crucial to work out now how you will protect your money.
For many international buyers, the safest option is using a forward contact, which locks in the same exchange rate for up to a year. If you lock in before the deadline, you will have the peace of mind that your money will be unaffected, whatever happens. Find out more in the Property Buyer’s Guide to Currency.
A buyers’ market – but how long will the opportunity last?
There has certainly been pent-up demand among buyers over the last few months. As property markets begin to reopen and countries discuss travel plans for the summer, including ‘air bridges’ between the UK and less affected countries, we expect there to be a surge of people looking to purchase.
However, on the other side of the equation, there is also pent-up demand among sellers and those who had hoped to put their ski home on the market this spring following the winter season.
Could this lead to something of a buyer’s market? It certainly seems likely that vendors will be keen to make a sale, and so we could see some room for negotiation.
However, how long this will last is difficult to predict. Most people are very conscious that the market has only slowed because of external factors and not because of a loss in demand, so we could well see a swift return to vendors holding firm on prices.
The same goes for investment opportunities. While, broadly, the holiday industry is certainly likely to see contraction this summer compared to usual, there is an interesting school of thought that says private rentals could do better than we might expect, with people being more comfortable staying in a single-occupancy property than a large hotel. If investors renting out their properties see relatively strong returns, particularly during a time of such uncertainty, it would not be unexpected for demand to rise – again moving away from a buyer’s market.
This is the time, then, to seize that opportunity. Start looking through SnowOnly’s properties and narrowing down your shortlist with virtual viewings and conversations with your agents. Then, once travel restrictions are lifted, you’re in a position to move as soon as possible, and not miss out despite what may happen this summer and beyond.
To find out more about purchasing your perfect ski home abroad, don’t miss your free Buying Guides, covering the purchase process itself, the legalities, finances and more.