One in five Britons and a third of Germans are considering retiring to Spain, according to a new survey by property consultants King Sturge.

The survey questioned 800 Britons and 800 Germans aged over 50 about their views on retirement.  The results showed that 22 percent of Britons and 35 percent of Germans were considering moving to Spain as part of their plans for later life.

A key factor influencing this trend is the high standards of healthcare and social services available in Spain with 44 percent of Britons and 34 percent of Germans claiming this to be something they found attractive.  Many Spanish estate agents now sell health and social care benefits as part of the packages they offer.

At a time when there are numerous indications that the German economy is beginning to turn a corner, Martin Zuchner, head of the King Sturge office in Madrid, said he believed there was a new-found optimism in the country about retiring abroad.

They came from the east...

The Spanish property market should also soon receive a further boost from the Spanish government's decision to lift restrictions on the entry of workers from the newest members of the European Union on Monday.

This will have a significant impact on the country's economic growth, as skills shortages - particularly in the construction industry so important to the Spanish economy - are plugged.

Francisco Gonzalez de Lena, of the Spanish Labour Ministry, told the Associated Press that the property market has been so hot for the last ten years that demand for manual labourers has far exceeded the availability of these workers from within Spain itself; the country has one of the lowest birth rates in the world.

An influx of foreign workers will also in turn boost demand for housing.

Mixed performance

The Spanish Ministry of Housing's official figures show that property prices increased by an average of 12.8 per cent in 2005, taking the mean cost of residential property to EURO 1,824 per square metre, up from EURO 1,618 at the end of 2004.  This is the lowest rate of property price inflation since 2001.

These figures, however, conceal dramatic differences throughout the country.  For example, prices rose by 20.6 per cent in Diudad Real (Castilla La Mancha), but fell by 0.4 per cent in Teruel (Aragon).  On the whole, inland properties and those on the north-west coasts (Galicia) performed better than properties on the Mediterranean coast and islands.