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The Ryanair Effect - 8 April 2008

A survey carried out by property agent Savills and Holiday-Rentals.co.uk has revealed that there are significant differences in the prices of properties in Spain dependent upon the proximity of the property to an airport served by one of the low-cost airlines from the UK.

The research discovered that properties bought as second homes within 10 miles of an airport served by a low-cost carrier is valued at 39 per cent higher than property further away. In addition, the survey discovered that those properties closer to the airports benefitted from earning up to 30 per cent more in rental income for their owners even when they weren’t living there themselves.

These figures seem to confirm, and put a statistic to, what has widely be known in the overseas property industry – that the low-cost carriers and their route planning has a huge effect on the property market in a given area. In some cases, it has even been seen that the airline routes are the driver behind the expansion of a property market from nothing to boom in a short space of time.

The flip side of the low-cost airline phenomenon is that they operate generally to very tight budgets, meaning that as soon as a route becomes less than profitable, they will shut it down or make the flights seasonal. This could potentially leave property owners with few options for traveling to their home overseas, and it is therefore advisable to buy near an airport that has more than one option to allow you to get back to the UK. In addition to providing a more secure way to make sure you can travel easily, the competition between two or more airlines should keep flight prices lower.

Low-cost airlines have fundamentally changed the way in which British tourists take their holidays, and have fuelled the growth in less-traditional destinations, shorter frequent breaks and the demise of package holidays. At the same time, it is important to keep perspective with the effect that more air travel has upon the environment. Spanish price comparison website Kyero.com said: “With flights becoming ever cheaper and budget airlines widening their reach on the Spanish market in particular, it is important not only to consider the positive financial results of this growth, but also to look at this impact on the environment and to consider ways that you as an individual can balance this”.

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