Are you planning to sell your holiday villa in Spain fast? Then you would be anxious about the result of the UK general election held earlier this month. There’s been a hung parliament in the UK, as you well know. How does that affect your holiday villa for sale in Spain?
Well, it’s pretty simple – Britons are the biggest buyers of Spanish property. Any slowdown in the interest from Britain affects the entire property market here, especially in the regions of Costa del Sol, Canary Islands and Costa Blanca, which are completely dominated by the British expat community.
The British election result has been a very strange one. The Conservative Party led by Prime Minister Theresa May are said to have lost despite ending up with 318 seats, just 7 short of the majority mark. Jeremy Corbyn of the Labour Party is said to have won despite ending with 262 seats, well short of a majority.
In all likelihood, Theresa May will continue to remain the Prime Minister with support from the DUP, a Northern Ireland party, which won 10 seats, enough to push the Tories over the majority mark.
But such an alliance is fraught with complications as almost everyone in the Conservative Party has a different expectation on Brexit. Some want a soft Brexit, while others want a hard Brexit.
The DUP has said that they want their opinion to be considered in the Brexit talks. Some newly elected Conservative Party MPs from Scotland want the entire Brexit negotiations to be done away with.
Apart from that, there are many in the Conservative Party who want Theresa May to be replaced. Then there are those who say that there is no alternative to May.
So you can imagine the confusion in the Tory ranks. A number of Britons who wanted to buy a holiday villa in Spain online are now postponing the decision as they are not sure what to expect as of now.
The pound has already dropped by 4 percent during the election campaign when it became clear that a hung parliament was a huge possibility. The pound sterling is now at 1.14 EUR at the time of this writing.
The worst outcome for British expats would be for a Labour-led coalition to come to power with Corbyn as Prime Minister. Corbyn’s policies are decidedly socialist, with an emphasis on higher spending, increased borrowing and higher taxations.
So that would hurt the growth prospects of the British economy and send the pound reeling. One can easily expect a 20 percent fall in the pound’s value if Corbyn comes to power in the immediate future. That would decrease the buying power of British expats looking to buy overseas properties tremendously, and could dissuade them from taking any chances.
But given the choice between a hard Brexit and a soft Brexit, most British expats would prefer the latter. A hard Brexit would have disastrous consequences for the British economy, while a soft Brexit with an access to a single market would be the best option for everyone concerned.