Currency specialist HiFX have revealed that the number of enquiries they have received regarding emigration are up some 30 per cent in the first half of 2008 compared to last year.
But despite this booming interest, those actually relocating overseas only increased by 10 per cent, suggesting that while the spirit is willing the finances are weak.
Mark Bodega, Director at HiFX, comments: "Bearing in mind that 2007 was a record year for emigration, the fact that even more people are looking to move abroad this year shows that there is now a very real desire to escape some of the problems in the UK economy.
"However the problem that many people are being confronted with is a simple one - they cannot sell their UK property and, without this equity from the sale of a house, they don't think they can fund their dream move and so are putting their move off."
Not only are would-be emigrants finding themselves trapped by the UK market slowdown, there's an additional visa problem which can put a premature end to any designs on fleeing British shores.
As HiFX explains, when a visa is granted it must be taken up within 12 months from the issue date or it expires, putting yet more pressure on expats to sell their property in time for their overseas exodus.
Rent It Out
But for buyers still struggling to shift their UK homes to fund their place in the sun, HiFx suggests remortgaging their house and then renting it out for the first 12 months.
This should effectively provide enough equity for emigrants to start their new life abroad, while also giving them the safety net of a home base should the big move unexpectedly turn sour.
Of course, there are some issues to bear in mind with this method, namely that the rental income should be at least 1.25 times the mortgage payments to make the venture financially sound.
And the mortgage on the UK property should also be switched from a standard home loan to a buy-to-let mortgage which will usually require the owner to have 25 per cent equity in the property.
Therefore doing your sums and seeking some independent financial advice should be the order of the day before rushing headlong into an overseas adventure.
Bodega adds: "There is a lot to think about when emigrating but it may be worth deviating from your original plans and considering holding onto your UK property until the market picks up."
Overseas Buyers Aren't In It For The Money
11-Aug-2008
People with a place in the sun are undeterred by falling prices since living in a key holiday locale is their main motivation… source: Savills
According to a new report by Savills into second homeownership abroad, the majority of buyers are after a traditional holiday getaway rather than an overseas cash cow.
The number of UK-owned overseas properties has shot up by 55 per cent over the past five years, to an estimated total of 425,000.
Spainand France continue to be the destinations of choice, accounting for 34 per cent and 23 per cent of UK owned properties respectively.
Portugal, the United States and Italy round out the top five.
Holiday Homes
You might expect lower house price growth in Europe (averaging just five per cent in 2007) to take the shine off an overseas purchase but the majority of buyers are untroubled by this.
Indeed, Savills report that the number of homeowners buying for retirement or leisure purposes is on the up.
Having the ideal holiday location is the key driver to securing a second home, with purchase price coming in second.
But while house-hunters are still after a bargain in the sun, 50 per cent suggested that the resale potential was not important for them.
And while they do tend to rent out their properties, this is more to avoid them standing empty than to capitalise on any investment potential.
Investors Get The Bargains
Nevertheless, Savills did find that 33 per cent of second homeowners were buying with an eye on investment, with 16 per cent hoping their purchase would net them a profit off rising house prices and 17 per cent going after the rental opportunity.
Investors tended to favour tourist cities such as Barcelona, London and Paris as well as emerging city break destinations like Prague, Krakow and Budapest.
Interestingly, while they let properties for an average of 18 weeks a year, compared to leisure buyers' 15 weeks, their weekly rents were some 12 per cent lower than their less money-orientated counterparts.
But while investors were charging around £549 a week compared to leisure buyers £622, they were generating much better yields thanks to purchasing at lower prices.
An investor typically bought abroad for £182,000 and achieved a gross yield of 5.4 per cent.
For the holiday-conscious leisure buyer, they were prepared to pay considerably more, around £220,000 while achieving yields of 4.2 per cent.
Savills forecasts that growth in second homeownership will slow over the next 24 months, but note that buyers' long-term outlook remains positive.