Europe's south offers a warm welcome to energy migrants

Software developer Victor Varlamov logs in every morning to work on a sunny Spanish island off the coast of Africa after the prospect of steep heating bills and a winter made harsher by the Ukraine war drove him to leave his adoptive home in Poland.

He is not alone in pursuing a warmer, cheaper way of life as tourist boards across southern Europe have seized on the cost-of-living crisis to advertise the benefits of wintering abroad to those living in more northerly countries.

Varmalov, 50, together with his wife and teenage daughter, moved from Poland's Baltic coast to Gran Canaria in Spain's Canary Islands two months ago and plans to stay for the coming months.

"The economic crisis and mostly the war situation have pushed me here," said Varmalov, who is Russian by birth.

Russia's invasion of Ukraine in February drove some energy prices to record levels in August. They have eased, but are likely to stay high and have led to painful levels of inflation.

Before leaving Gdansk, where he has lived since 2016, Varmalov calculated he could save 250 euros ($259) on rent each month and pay 140 euros for all his utilities and internet, instead of the 200 euros he was paying for electricity alone in Poland.

What he now saves, he spends on eating out, he said, and also enjoys beach walks in his lunch breaks.

"The reality is better than my expectations," he said.

The regional government of the Canary Islands, where the average winter temperature is 20 degrees Celsius (68°F), launched a social media campaign in September to attract remote workers, such as Varmalov, and retired people from countries including Britain, Germany and Sweden.

"It is no secret this will be a winter of great economic uncertainty in Europe but in the Canary Islands, we want to turn the situation around," said Yaiza Castilla, the regional tourism chief, describing the islands as an "economic refuge".

Other southern European countries also see the potential.

The Greek tourism minister in September visited Austria and northern European countries, such as Sweden, to "turn this huge energy crisis plaguing Europe into an opportunity".

Portugal's tourism board has also campaigned and its head Luis Araujo said expectations for winter tourists from northern Europe were "very positive".

Tourism data supports his optimism.

Data collected for Reuters by home rental search engine HomeToGo showed that compared to last year, searches from countries such as Britain, Germany and the Netherlands rose 36%, 13% and 3% for winter accommodation in Spain, Greece and Portugal, respectively.

Gabriel Escarrer, CEO of Spanish hotel chain Melia, said people are booking apartments and suites for two or three months this winter in the Canary Islands, with a notable presence of Scandinavian visitors.

'REFUGE FOR WINTER' AND BEYOND

Visitors and more permanent residents are also arriving from Germany, which was highly dependent on Russian gas before the Ukraine war and is anxious about possible winter energy shortages.

Among schools enrolling more students from abroad, the German school in Gran Canaria received 40 applications from foreign students this year, which it said was higher than in previous years without giving precise figures. 

Repeople, a co-working association in the Canary Islands, said it had been fully booked for November and 80% full for the rest of the winter. 

Among those occupying a slot at Repeople is 31-year-old German freelancer Heiko Schaefer, who plans to stay until Christmas.

"The current rising prices is a reason for many people to move further south," he said. "This island is a refuge for the winter."

Airlines will increase by 31% the number of seats available to the Canary Islands, the regional tourism office said.

TUI fly, the leading airline operating between Germany and the Canary Islands, said it would increase flights by around 10%, adding in a statement energy costs were "a psychological element" in pushing more people south.

Airbnb, the short-term rentals firm, said searches for winter stays in southern Europe tripled between April and June.

STUCK AT HOME OR A PERMANENT MOVE

For the majority of northern Europeans, however, heading south is just a dream when the rise in living costs means they cannot afford the luxury of travel.

Instead they are stocking up on goods to keep themselves warm such as duvets, slow cookers and electric blankets, retail sales figures in Britain show.

Others though have decided to move permanently.

Natasha Caldeiras, from Kent, southern England, and her family are moving just before Christmas to her husband's native Portugal. They said energy prices were the spur.

Caldeiras believes the warmer weather will allow them to turn on the heaters for a shorter period than in Britain, where their monthly bills are around 200 pounds ($242) per month and set to rise.

"Even before the energy crisis, we would have liked to be in Portugal because of the weather," the 28-year-old said. "But with the energy crisis, (being in Portugal) gives us more security because of the climate."

Murat Coskun, chief executive of real estate advisory firm Get Properties, said the cost of living crisis was "fuelling the trend" of Britons deciding it was time to leave.

"I don't think we are at the peak yet," he said. "The winter is going to be tough."