Not content with a house price boom of their own, thousands of Britons each year are taking advantage of rising property prices in the UK to fuel a property boom in Europe according to research conducted by Barclays.

In 2003 alone, 40 per cent of all dwellings built on the Spanish Costas were bought by the British and of those 63 per cent were bought for holidays or retirement, helping increase prices on the Spanish Costas and in the Balearic islands by 21 per cent year on year – this is triple traditional house price growth of around six to seven per cent.

A similar story is seen in France where in the past 12 months second home hot spots have seen property prices increase significantly, for example by up to 28 per cent in Languedoc Roussillon, which is almost triple the national average house price inflation in 2003 (11.3 per cent).

Barclays puts the growth of property prices down to a number of factors: Equity release has reached record levels in the UK in 2003 at around £57 billion due to the rapid growth in UK property prices. Much of this has been used to buy cheaper European property outright. The cost of an average house in France is €124,000 (circa £81,000) and in Costal Spain €130,000 (circa £87,000).

Low cost airlines are flying to more and more destinations and fierce competition is keeping the costs down as mainstream airlines offer competitive deals alongside low cost carriers. Interest rates in Europe are also at historically low levels and even cheaper than in the UK – this means mortgages in France and Spain have never been better value.

Barclays recently announced the launch of FranceSolutions – a new package combing a wide range of assistance and banking services to make property buying and settling in France easier for Britons.