1. Sweden
Sweden is becoming an “attractive destination” for foreign investors, says Patrick Kidd in The Times. And quite right, too. The scenery is breathtaking and there’s loads of space: with a population of less than nine million, there are only 52 people per square mile. Better still, you can buy a large villa overlooking one of the country’s 96,000 lakes, with perhaps a dozen acres of forest, for the price of a small London flat. Estate agent Britta Sugden (0131-663 7605, http://www.homesinsweden.com/) is currently selling a holiday house in Flor, 230 miles northwest of Stockholm, with four bedrooms, three reception rooms, three outbuildings, a guest cabin, six acres of forest and meadows and a view over a lake. The price? A mere £155,000.
2. Northern Cyprus
If you are searching for a property bargain and are really prepared to take a gamble, look to the Turkish Republic of Northern Cyprus (TRNC), says Sonia Purnell in The Independent. In the southern Greek part of the island, houses have gone up fast in price, but to the north you can still buy unrenovated houses for £20,000-£30,000. But there is a catch. The TRNC is a “pariah statelet” and that means that the security to the title deeds is questionable (much of the land once belonged to the Greek Cypriots and could be forcibly returned to them).
If you are prepared to take the risk of losing your home at some point in the future, however, there are fabulous deals about. The best houses rarely stay on the market for long, but a large stone ruin on the Karpas peninsula, home to “beautiful and quiet beaches”, has recently come onto the market at £19,000. Also on the market is a pretty white-washed “project” in the village of Karmi for £35,000. It’s not a ruin, but is in need of renovation. Once finished, it could have 11 rooms, a large garden and “wonderful” sea views. Contact Ian Smith, 00 90 39 2815 7118.
3. Switzerland
If you thought you had to be a millionaire to buy in Switzerland, the reality will surprise you, says Jane Barry in the Evening Standard. The market has been seeing steady growth over the last few years, but you can still buy a two-bed flat in a chalet-style apartment block “within skiing distance” of Verbier for £181,000 and a three-bed apartment for £263,000. Add in the combination of a stable economy, low interest rates, tax advantages, competitive prices, rigorous planning laws that prevent over-development and the fact that by 2008 your home ownership will bring you Swiss residence, and Switzerland looks like a brilliant all-round investment. The “fabulous” scenery, food and wine is just an extra bonus. Contact Chesterton International, 020-7201 2070.
Don’t expect to make money by letting in France
It seemed an easy route to riches: buy a house for less than you would have to pay here, use it yourself, or rent it out and end up with a nice asset once you’ve paid off the mortgage. Not long ago that was just what you could do in France. No longer. Nowadays the country is “awash” with Brits renovating properties, says Miles Brignall in The Guardian. While it may still be possible to find a nice house, don’t expect to make money out of it. Unless you’ve locked in a yield somehow (with a leaseback scheme through a developer, for example), you aren’t going to make any money with a gîte. “There are only so many people looking to rent houses at £600 per week.” The fact is that even now French gîte owners are already struggling to find bookings outside the “magical” months of July and August.
Even getting your share of the slim pickings on offer can prove pricey. Everyone expects higher standards these days and refurbishing a house can cost hundreds of thousands of pounds and take eight to 12 months longer than planned. Swimming pools are a must, but they cost at least £20,000 to install. Then when you are up and running, there are still costs galore, says Helena Frith Powell in The Sunday Times. On top of 25% income tax on rental profits (say, 28% of gross income), you also have to pay local taxes - taxe foncière (land tax) and taxe d’habitation. Maintenance can also push up costs: don’t forget advertising costs, management fees and the cost of a cleaner or gardener.
This is not to say you can’t make a success of running a gîte in France, says Miles Brignall. Those who do tend to have an edge over rivals. For example, one couple bought their bed and breakfast near the Nogaro motor-racing circuit, which receives visitors all year. But these instances aside, the most you can expect - if you are lucky - is to rent out a property for 20 weeks a year at £600 a week. That’s £12,000 a year. Once running costs and tax are deducted, that “doesn’t leave a lot”.