Generation BARBIE
We've already had the pleasure of YUPPIES, NIMBYS, WAGS and DINKIES. The new kids on the block are BARBIES - they're 20-somethings who 'Buy Abroad and Rent in Britain'
Reproduced from the April 2008 issue of A Place in the Sun Subscribe now
Eoin Welch can't afford his own home in the UK, so he's bought a holiday apartment for £25,500 in Turkey. The 23-year-old business development manager says high prices and uncertainty in the UK housing market forced him to look for money-making opportunities abroad.
He's bought a two-bedroom apartment in Altinkum, on the Aegean coast, through emerging market specialists The Right Move Abroad.
'I see this as a long-term investment with a good return,' says Lancashire-based Eoin. 'It will be ready in June, but there are new golf courses and a marina planned so I don't intend to sell it for at least three years. I want to maximise my investment.'
Eoin has a five-year plan to build up a property investment portfolio and says he's now started searching on the Internet for a ski apartment in the French Alps. His advice to other young buyers is to get backing. 'I didn't find it easy to get a mortgage so my parents helped me out and I secured the rest with a bank loan,' he says. 'I'm not too concerned about the risks I'm taking because the potential benefits far outweigh the negatives.'
As an overseas property investor in his early 20s, Eoin is not alone. Overseas homes insurer Hiscox has seen such a sharp rise in young people buying overseas that it has coined an acronym for them: 'BARBies' - those who 'Buy Abroad and Rent in Britain'.
Figures released last month by the Halifax reinforce the situation facing Britain's Barbies. During 2007 the number of owner-occupied households in England fell by a record 83,000. This fall was driven strongly by a decline in people under 34 buying property. Between 2001 and 2006, there was a 25.4 per cent fall in owner-occupiers aged 16 to 24 and a 15.8 per cent drop for those aged 25 to 34.
'The fall in the total number of owner-occupied households in England in 2007 largely reflects the increasing affordability difficulties faced by many potential purchasers as a result of the rapid rise in house prices in recent years,' says Martin Ellis, Chief Economist at Halifax. 'The figures for owner-occupancy clearly demonstrate that these affordability issues are most pronounced amongst younger people and in southern parts of England.'
According to Laurent Schonbach from Hiscox, Bulgaria is a popular overseas destination for young buyers. They?ve spotted the fact that the country's joined the EU and seen the chance of picking up a flat in Bulgaria for the price of a swish car over here. People in their 20s tend to spend £40,000-£50,000 there.'
Watford girl Samantha Griffiths, who bought a £40,000 Bulgarian studio apartment said she opted for a five-star development to get a better rental return. The 28-year-old bought at the Pirin Golf and Ski Resort in Razlog. 'I'm saving for a house, but what can you buy in the UK for £40,000?' she asks. 'Three friends and I have bought four apartments in the same block that we hope to sell on to another group of friends.'
Michael Johns from The Right Move Abroad says: 'The Barbies market is growing faster than most. Barbies find overseas property exciting and can move fast to secure a deal. There's also the 'pub brag' factor - telling everyone else about it in the local bar. They look for opportunities in emerging markets like Turkey and Egypt, where there's sun, plenty of diving and low entry-level property, and the risk is lower. They focus on the numbers.'
Reproduced from the April 2008 issue of A Place in the Sun. Subscribe now
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