Top 3 best European countries for buying a vacation home

The Spanish city of Marbella, located on the country's southern coast, is popular with overseas buyers. The three European countries that are "perennial favorites" for buying vacation homes are France, Italy and Spain. This is due to political stability, good governance and easy access to the mortgage market, factors that have helped these countries become popular with overseas buyers.

It is also easy for buyers to understand the real estate market with the help of land registries that show the value of properties sold, and they are embellished with soft factors such as attractive nature, good food and attractive towns. Before you start your search, consider what you want to get out of the property. It is also important to consider the possibility of renting out the house. "With the increased cost of mortgages, we are seeing more and more people wanting to rent a property ... without the hassle," Everett-Allen said.

Some countries have introduced digital nomad programs after the pandemic, which are an attraction as house renters often want to stay for two or three months. Also make sure you can get there whenever you want. "Some countries you can't fly into in the winter, so . you'll be able to get there easily from your home?" - Everett-Allen said. There's also a "lock and leave" factor for when you're not living in the house, so consider what local contacts you have that can help with maintenance or security when the house is empty.

People are spending more time in their vacation homes than they used to, Everett-Allen says. "It used to be that [people] wanted to be able to get from the airport to their house within an hour. Now we're seeing that they're willing to travel a little farther because they're going to be spending a week in their homes rather than a weekend," she said.

It is worth checking the rules for renting through Airbnb or similar platforms. For example, the Italian city of Florence banned new short-term rentals through such platforms in October, and Paris has a 120-day limit on residential rentals.

France

France is the most visited country in the world, according to the UN World Tourism Organization, and Provence and the Alps, with their amazing scenery and plenty of space, are popular with buyers from Northern Europe. Since the pandemic, the Alps region has become popular for its outdoor lifestyle. "It has everything you could want: views, nature, space, the opportunity to keep fit, time with family and friends," she said.

Courchevel 1850 had the highest prices for luxury properties in the second quarter of 2023 at 27,250 euros ($29,866) per square meter, while the resort of Morzine had the lowest price at 9,700 euros per square meter, according to Knight Frank research.

There are efforts to make France a more attractive destination for U.S. residents, with a plan that includes giving French entrepreneurs in the U.S. visa extensions and simplified visa procedures for American business owners, according to Olivier Becht, France's foreign trade minister, in an announcement regarding the deal in Nov.

France also encourages the purchase of new-build properties in the country by offsetting the standard tax rate (known as TVA) of 20% if the property is rented out for about 14 weeks a year. A two-bedroom, two-bathroom apartment in Meribel-les-Aloues near the ski elevators is for sale on Knight Frank's website for about $605,000.

Italy

Tuscany, with its vineyards, farmhouses and cities such as Florence, Siena and Lucca, has always been popular, according to Everett-Allen, as have the towns and villages around the lakes in the north of the country, where both mountains and cities are within easy reach. A six-bedroom villa on Lake Como, where George Clooney reportedly lives, is for sale on Knight Frank's website for about $2.3 million.

To get more for your money, the Apulia region, located in the heel of the "Italian boot," offers "stunning coastlines, charming historic towns, and delicious cuisine," said agent Sara Traverso, co-founder of the real estate company Nest Seekers International, in an email to CNBC.

A rural house in Puy with four bedrooms, two bathrooms, and a pool is being offered by Nest Seekers for around $497,000. Traverso, who worked for several years at her family's real estate firm in Italy before moving to New York, said that the central region of Umbria is also popular due to its medieval hilltop towns and tranquil lifestyle. "Preserving cultural heritage attracts people looking for a more peaceful, authentic Italian experience," she said.

The island of Sicily is also becoming an increasingly popular destination for vacation homes. And 2024 could be a good time to buy, as Traverso expects a decrease in prices across the country and an increase in supply, which is advantageous for foreign buyers. Traditional white houses are characteristic of Ostuni, in the Apulia region of Italy.

Spain

Spain is popular as a buying destination among the French, British, and Germans, and it has also gained significant popularity among foreign buyers due to the new visa program for digital nomads introduced this year, allowing people from non-European Union countries to live and work in Spain for up to five years. "If you have a home and a digital nomad lives there for two or three months, it's quite beneficial," said Everett-Allen.

The Spanish capital, Madrid, which previously remained undiscovered by foreign buyers, is becoming popular due to its appeal compared to London or Paris, said Everett-Allen. "It's a relatively small city with a vibrant identity, good culture, and easy access, as there are now many flights to Madrid," she said.

Luxury real estate in Madrid costs around 8,000 or 9,000 euros per square meter, compared to Paris, where the price is about 19,000 or 20,000 euros per square meter, said Everett-Allen. However, property prices in Madrid are expected to increase by about 5% in 2024, making it the fastest-growing city in European real estate, while luxury property prices in Paris will rise by 2%, and the agency stated that prices in London will remain stable.