Overseas Trends:Irish buyers were faced with a bewildering choice of foreign properties in 2006. The trend is set to continue in the year ahead, writes Frances O'Rourke.
Want a house in Florida? Buyers with cash could pick up bargains there if they're ready to haggle. An apartment near Rzeszow, in Poland? Ryanair will be flying there direct from the end of January. Ready to try out Cape Verde, the island country tipped as the new Canaries, now that direct flights can take you there?
Or are you biding your time to see what happens on the home front over the next few months?
It's not clear yet whether the downturn in the domestic property market will slow the nearly reckless spending sprees Irish buyers have gone on in markets from Bulgaria to Brazil in the past few years. But caution - a word not generally associated with Irish buyers overseas - might be about to stage an appearance.
The soaring value of suburban three-bed semis was largely responsible for unleashing the mostly middle-aged and middle-class Irish buyers onto world markets, looking for a villa or apartment that would be part holiday home, part pension. (They were followed by younger buyers getting onto the property ladder by buying their first home abroad.)
The "equity release" buyers, financing their overseas purchases by borrowing in Ireland against the value of their own homes, probably outnumber pure investors and it's possible that their number will fall as uncertainty over house values in Ireland rises. Alternatively, more buyers here might look at raising finance overseas: it's easier and - except in France - is less bureaucratic than many of us think.
However we get the money, agents like Niall McHenry and international property lawyers like Tom McGrath don't think we'll give up our appetite for second homes abroad quickly.
McHenry, overseas manager of Gunne New Homes, agrees that sales have slowed - as they often do at this time of year anyway - but is hopeful that come spring, "lifestyle purchasers" will be back in play. His agency sells mainly in tried-and-tested markets such as France, Portugal and Italy, countries that don't offer spectacular capital growth but do have solid long-term prospects. "What most people are looking for is a holiday home that will appreciate and get some rent."
McGrath says, "My gut feeling is that buying homes overseas is an accepted way of life now for a lot of Irish people." He feels the market is probably roughly divided between investors and - that buzz-phrase again - "lifestyle purchasers".
For investors, McGrath, along with other property pundits, puts Poland high on the list of markets to watch. Properties in the country's main cities - Warsaw, Krakow, Wroclaw - are expected to grow in value because of the country's strengthening economy. (Currently you can buy apartments and villas from around €100,000-plus).
Ryanair included Wroclaw and Krakow in the 40 new routes from Dublin and Shannon it launched in 2006. Dublin to Rzeszow will be one of 12 it will launch in January and February 2007. The airline has played a major part in the Irish overseas buying boom, and anywhere from 5 per cent plus of its passengers are likely to be foreign property purchasers/owners, says Peter Sherrard, the airline's communications director.
The "Ryanair effect" is credited with doubling property values in some markets; in places like Perpignan, they've reportedly gone up by 40 per cent.
So property buyers - like property developers - could check out where Ryanair is heading to see where emerging markets are likely to be. Be warned however - Ryanair drops its worst performing routes on a regular basis, so you need to be sure other basics are right (is the property in a city? Near a beach? A golf course? Other transport? Is there a good rental market? And so on).
Out of the bewildering range of foreign properties on offer in markets overseas, how is a buyer to choose? If you are a "lifestyle purchaser", tried and tested markets in France, Portugal, Italy (mainly Tuscany) and Spain away from the costas (Valencia, Seville, Cadiz, northern Spain, says McGrath) are still the best bets.
For investment (and possibly holiday homes), the pundits tip the Caribbean, Canada, Montenegro, Bulgaria (if you're careful, and don't buy somewhere too overdeveloped), Berlin, and central London, expensive to buy into, but likely to double in value over the next five to 10 years, predicts Assetz.
And then there's Cape Verde, a market a number of Irish developers and agents confidently believe is the next Big Thing. Pundits are divided here, because Cape Verde is still a developing country with limited facilities.
But Charles Weston-Baker of Savills, which is selling a development on the lushly green Cape Verdean island of Santiago, and Stuart Law of UK investment advisers Assetz, both point out that Cape Verde has one major asset - great weather.
"It has a 12-month season," says Law, "and could turn into a full-on tourist destination, in which case prices will rise beyond belief."
In other words, you might make a lot of money in years to come if you buy a property there now, at a reasonable price - from about €100,000 for an apartment, from €150,000 for a villa, says Law.
Where to steer clear of? Possibly the US, where property values, like the US dollar, are plummeting although opinion is divided on this. Savills' Charles Weston Baker says that in Florida, buyers with cash and an eye for a bargain can knock 20 per cent off the asking price of properties there. "And the market will definitely recover there, because the underlying demographics are right."
On the other hand, Stuart Law of Assetz says, "I'd be very nervous of the US at the moment," because values are still falling.
A market like New York, on the other hand, is strong but very expensive, both because of cost of purchase and high property taxes - Gunne sold apartments there this year, but it's really a market for investors looking for a trophy property, says Niall McHenry.
