Brits investing in Spanish property going for villas

Norwich and Peterborough Building Society (N&P) has found the popularity of taking out a mortgage for a detached villa in Spain is increasing.

Although most Brits opt for an apartment when investing in a home in Spain, the popularity of detached villas rose seven per cent to 22 per cent last year, N&P said.

This compares to a reduction of seven per cent on apartments, from 56 per cent in 2003 to 49 per cent in 2004.

A recent report found that property values in Spain increased faster than those in the UK in 2004, with France the only EU country that had a greater increase in house prices.

A typical N&P customer investing in a mortgage in southern Spain borrows just over 50 per cent of the value of the property they are buying, the research found.

Their average £113,000 mortgage is arranged to be repaid typically over 16 years.

Meanwhile a quarter of those who bought a property in Spain during 2004 were aged between 31-40 and a third (33 per cent) were aged 41-50. Only 14 per cent were aged over 61 years old.

Stephen Penlington, N&P's general manager customer service, said: "Buying in Spain is still growing in popularity and this could be a reflection of the rise in UK house prices which has helped many people afford to buy overseas by releasing equity.

"In fact, N&P's lending in Spain increased by nearly eight per cent in 2004.

"Those who are looking to buy should move quickly though as Spain is overtaking the UK in terms of house price growth. Look now before prices rise out of reach."