Is the Dream Over for British Expats?
The headlines are loud and strident. “One in five British Expats in Spain coming home.” “Is the dream over for British Expats?” Since 1995 an estimated 760,000 people have left the UK to live in Spain. As the European recession continues to bite, not for the first time the media are asking: Are the British giving up on an overseas life in the sun?
There is certainly substance to this most recent story about the Brits quitting Spain. The latest statistics, from data kept by Spanish town halls, where long-term British residents are supposed to register (people on shorter stays, with holiday or rental homes, spending less than six months a year in Spain weren't included) shows that 90,000 expats left their Mediterranean homes in 2013. The total included Germans and French too, with only the Chinese presence growing.
One English language newspaper reported that 20,000 Brits wanted to leave the Costa del Sol alone. As many as 50,000 expats in other popular areas were hoping to go back home. And it was only their inability to sell their home that was keeping others there.
We should be wary of overheated newspaper headlines, of course. In 2010 the Daily Mail reported that as many as 4 million Brits were planning a mass return home “after seeing their savings and income stripped by the plunging values of the pound and their property. The dramatic slump has slashed their income by a third and has turned Brits into the paupers of Europe.” That turned out to be a considerable overstatement. People did return home, but on nowhere near the predicted scale.
An ongoing exodus from Spain is to be expected, with the brutality of the recession and the loss of jobs there impacting on people's finances. Some were forced to sell their homes at a big loss.
Others were in a worse predicament. Employed locally and buying their home with a mortgage, they lost their jobs and had their homes repossessed.
However one British estate agent working on the Costa Blanca was quoted this month (June 2014) saying he did not believe there had been a significant fall in the number of Britons living on the Costa Blanca. According to Geoffrey Miles of Buy Javea Property, many people there had retired with a UK pension, and their income did not depend on the Spanish economy.
And properties which had been repossessed had come back onto the market at bargain prices, and were being purchased by a steady stream of British buyers. He said that so far in 2014 more than 40% of his sales have been to UK buyers, an increase of 20% over the same period last year.
A property selling for of €400,000 at the height of the property boom in 2007, could now be picked up for half that price. The average price of a property his company sells is currently around €170,000, compared with €250,000 in 2007.
The strong pound helps. At the end of May (2014) it was worth 7% more than in the summer of 2013.
Miles added a word of caution. After the recent turmoil in Spain, it's not worth looking there to buy property as an investment. However he does recommend buying if you plan to relocate, or if you want a holiday home.
To throw more light on this “influx” of disillusioned expats into Britain, I turned to the most authoritative source available, the U.K.‘s Office of National Statistics (ONS). Its latest Migration Statistics Quarterly Report, February 2014, doesn’t draw firm conclusions either way.
In the year ending September 2013, the estimated number of British citizens coming back to (the ONS calls it “immigrating to”) the UK was 79,000. This figure is the same as the estimated number of British immigrants to the UK in the previous year.
There was a slight increase in the number of British citizens immigrating for work-related reasons, to 39,000 in the year to September 2013. British citizens immigrating for formal study was the same as the previous year (8,000), and there was even a slight fall in the number immigrating to “go home to live”, to 20,000, although none of these changes was statistically significant, said the ONS.
The estimated number of British citizens emigrating long-term from the UK in that year was 138,000, which, although lower, is statistically at a similar level to the 150,000 in the year ending September 2012. Emigration of British citizens is 33% lower than at its most recent peak of 207,000 in the year ending December 2006, and has remained at around the same level since 2010.
It’s a statement of the obvious to say that British expats are returning home all the time, some sooner than they planned, and they always have – even if not at the rates that the media would have us believe. What are their reasons?
A poll by Global Visas, a company specialising in immigration and relocation, of 1,246 British expats who returned in the past year, showed that a third were coming home earlier than intended, most of them citing financial difficulties as the main reason. Other reasons given were homesickness (47 %), cultural differences (44 %), visa expiration (39 %) and lack of social interaction (27 %). (They were allowed to give multiple reasons.)
If expats aren’t returning home to the UK, are they behaving differently? There are indications that people heading to Spain now may be less interested in retiring there. Some estate agents report that British people are snapping up bargains as holiday homes and have no intention of living in Spain.
And people leaving Spain are not necessarily coming home to the UK. According to estate agent Savills their next stop could be moving to Dubai, the Caribbean or Switzerland.
People are looking looking for safe havens, said a spokesman. Good weather at the location counted too, as did easy direct flights from Britain. It seems expats still have an enduring dream, and want to stay away. More than three-quarters of British expats would never return home out of choice, according to research by financial advisory organisation the deVere Group, and published in August 2013.
77 % of expatriates said they would only consider a permanent return to Britain if it became untenable to live overseas for serious personal reasons. 653 people were polled in several global destinations including Abu Dhabi, Bangkok, Barcelona, Cape Town, Dubai, Hong Kong, Marbella, New York, Nice and Zurich.
Most of those interviewed said that it would take seriously poor health, a personal financial crisis or a family emergency for them to even think about moving back to Britain.
As for the factors that would stop them returning home, the top three were Britain’s poor climate, high crime levels and high cost of living.
Some countries are seen as less attractive to expat “lifers”, compared to the countries where people put down roots, such as Spain, France and Portugal, and we shouldn’t be surprised there is quite a brisk turnover, with expats leaving for other countries or going home.
The influential HSBC annual Expat Explorer Survey notes that in many Middle Eastern countries a high proportion of expats in the region are looking to leave their current country.
About a third of expats (from many countries, not just Britain) in Saudi Arabia (34%), Qatar (30%) and Oman (29%) are actively looking to leave their current country for either another posting or to return to their home country – a much higher proportion than the global average of one in ten (13%).
“However, this high proportion of expats looking to leave is not a result of unfavourable conditions,” notes the survey. “The current economic and political outlook remain positive in almost all Middle Eastern countries in comparison to global averages.
“Instead, it seems Middle Eastern-based expats retain a much stronger affiliation with their home country than expats in general, which may suggest these people have always intended to move to the Middle East for a set period of time, before returning to their home country or moving to another expat posting.”
Soul and substance
Countries showing the highest rates of returning expats tend to be the old Commonwealth nations, South Africa, Australia and New Zealand.
One country where there seems to be stronger evidence of people returning home in big numbers is South Africa. A report in early 2014, by Adcorp, a workforce management and business outsourcing company, estimated that 359, 000 high-skilled South Africans had come home since 2008, when the global financial crisis began, and have been absorbed into the labour force.
Another South African body, Homecoming Revolution, which aims to tempt home African diaspora professionals, estimated 340, 000 professional South Africans have returned in the past 10 years. But others question if the figures are that high.
There is some evidence that people are returning to South Africa for more positive reasons than that they were simply being driven home by the state of the economy abroad. South Africa is seen as a young country with a vision. One commentator said the reasons for returning home were, firstly, friends and family, then a sense of purpose and belonging, then the country's lifestyle and career opportunities.
“South Africa has a soul and substance to it that I missed in the States”, said one returnee. “The climate is right and the people are friendly.”
By 2012 there was a separate exodus from Europe, and particularly Britain, back to New Zealand. One jobs website said Kiwi expats were “ditching economic doom and gloom in Europe for better job opportunities back home”.
The site quoted UK Home Office figures showing that the number of New Zealand citizens entering Britain to work fell by 40 % between 2009 and 2012. At the same time-time long-term New Zealand expats in Britain and Europe was said to be going home to settle down after gaining valuable experience abroad.
In Australia a record numbers of expats who had spent more than a year abroad were said to be heading home. In July, 2013, the Australian Bureau of Statistics published figures showing that fewer people are leaving Australia to find work overseas, suggesting that the country’s “brain drain” had gone into reverse.
One of the reasons put forward was the continuing slump in European economies. A year on, and, and it’s quite possible the situation could change. With the UK’s economy improving rapidly, it’s possible that it will become a magnet once again to those footloose Antipodean travelers.
The hardest posting?
And what of the experience of returning home itself? That should be easy, shouldn’t it? Not so, says Jacqueline van Haafen, at Netherlands-based Global Connection. The company gives advice to people working abroad and their employers: that move can be deceptively difficult. “Nearly all expats agree that repatriation is the hardest posting. “Most expats think going home will be a piece of cake, after all, it is home. They do usually realise that things back home have changed, but not that they have, too. “Feeling an alien for a while in a new country is something one might expect, but feeling an alien in your own country is something different.”