Gibraltar: The Rock works for us

By Liz Gill
Posted: 2010/08/23

LIZ GILL reports on a new trend of British expats living in Spain and working over on Gibraltar rn

LIKE COUNTLESS other commuters Mike Nicholls drives to work in the morning listening to BBC Radio 4's Today programme and home again in the evening tuned into PM. The difference is that Mike's home is in Spain and his job is in Gibraltar.

His lifestyle is an example of a growing trend in this southern tip of the Iberian peninsula w here a curious new marriage of convenience is proving popular between the Costa del Sol and The Rock. The old colony has the clout, the cash, the jobs and the tax breaks while the Costa has the lifestyle: the beaches, bars and restaurants and golf courses. And because it has more space, property is half the price of that clinging to two and a half square miles of limestone crags on the British Overseas Territory.

"You can easily spot the Gibraltarian residents in Spain by their car number plates w hich you can find all along the coast, " says Mike. "Some will commute, others will live in Gib and have a weekend property in Spain.

There's a lot of mixing and matching."

Mike, 43, a former accountant with KPMG and now director of Chesterton estate agents, w ent to Spain in 2002 to help market the £125million Ocean
Village project, the brainchild of direct marketing tycoon Greg Butcher who spotted a gap in the market: wealth w as flooding in but there was nowhere for the wealthy to live.

Mike lives with his wife Lucy, 42, and their children Harry, nine, and Lucy, six, in a villa with a pool in Manilva. It is a half-hour drive from Gibraltar.
Although priced 20 per cent higher than anything else, the 117 apartments sold off plan within a month.

Subsequent developments around the revamped marina and on other sites have continued to sell.

Gibraltarian Justin Bray of Bray Properties has seen massive changes. "Historically second home-buyers would be setting up a little pension, spending maybe a month here every year and then renting it out for the rest. Now people are buying for investment and some have large portfolios. The rental market is very strong because there are so many people here on short-term contracts: maybe up to 8,000 out of a total population of 30,000."

A two-bedroom apartment in Ocean Village overlooking the marina would today cost about £500,000 though there are modest properties elsewhere for about £200,000. Across the border buyers would get a lot more for their money, particularly now in the wake of oversupply, recessions in Spain and
Britain and general nervousness following the corruption and illegal planning scandals.

There are stark reminders of the market's collapse: massive "urbanisations" left half finished or with only a handful sold.

In Marbella, however, there are signs of a recovery. Taylor Wimpey has started building again, the first developer on the Costa to do so in at least two years. "Because they're a multinational working in the States they had picked up on the sub-prime crisis there and they saw what was coming in Spain in a way local developers didn't, " says sales consultant Francisco Tanti.

With that excess now almost absorbed, the company believes the time is right for new projects like La Floresta, perched 1,000ft above sea level five miles from the beach at Elviria.

The 23 apartments in the first phase, due for completion next year, range from £147,000 for two bedrooms to £248,500 for three bedrooms.

There are two swimming pools and communal gardens and owners have access to its golf course and clubhouse.

"We're confident about sales because we know people will always want a property in this area, " adds Senor Tanti. "We have the climate, the infrastructure, the beaches, the smart shops, the food and the culture and there are cheap flights to the UK."

Senor Tanti anticipates that as elsewhere in the region, 60 to 70 per cent of buyers will be British, predominantly middle-class and middle-aged. Those who relocate or retire there may soon find themselves joining other expats who queue to get into Gibraltar with its sterling currency, fish and chip shops and Morrisons. They come for familiar brands and tax free luxuries: petrol at 90p a litre, 200 cigarettes for £15 and a litre of Scotch for £6.

"We earn in Gib and spend in Spain, " says Mike Nicholls who also runs his own property and funding consultancy MN Associates.

Though Gibraltar prices rose by up to a third between 2003 and 2007 they have remained fairly static since. "A 10 per cent discount is probably the maximum you could negotiate at the moment, " he says.

Brits buying in Gibraltar have a sterling mortgage and the same interest rates as the UK. Brits buying in Spain can usually choose between a euro and sterling mortgage.

MORE INFORMATION: taylorwimpeyspain.com, 08000 121 020; brayproperties.com, 00 350 200 47777;
chesterton.gi, 00 350 200 40041;