As the eurozone crisis goes from bad to worse, UK owners of property on the Continent are putting them up for sale so they can bring their money back to the UK.

Not only are they seeing the value of their property falling in sterling terms on an almost daily basis, but there is also the prospect of having to pay more tax to help shore up ailing European government finances.

A strong pound usually has the opposite effect. Mark Bodega, of foreign exchange brokers HiFX, says: "Normally when sterling strengthens against the euro, we'd expect to see a raft of euro [property] buyers. But at the moment everything is counter-intuitive, it's all euro sellers. Fear is most definitely driving these transactions and buyers, whilst they might be tempted, are taking a wait and see approach before taking the plunge with regards to buying property. Why buy now when things could easily get worse seems to be their mind set."

Recent research from HiFX found that 34% of Britons with a property in Spain, where house prices are down 25% since their peak in 2007, are trying to sell. The level rises in Greece where 39% of Brits are looking to sell.

However, people who are managing to sell are having to accept lower prices because of the lack of demand. Charles Weston Baker, of Savills International, says; "Because there are not many buyers, property owners are having to pitch the price below what they really want to receive, say 20% less, in order to attract buyers"

There are some positives, though, says James Hickman, managing director of Caxton FX. He points out: "On the plus side, overseas home owners with a euro-based mortgage are being presented with an excellent opportunity to pay more of their debt off as their pound will stretch much further against the single currency." One of the problems faced by home owners who do manage to sell is that they face losing money until the sale is complete if the euro continues to slide.

HiFX points out that the seller of a high-end villa in Italy, who agreed the sale of his property for €550,000 in early 2012 – when rates were around 1.18 – and was expecting to receive £466,000, would now on completion of the sale only be realising £437,375. A loss in value of £28,625 highlighting the risk owners are exposed to on a three-month settlement on a European property sale.

For those with properties in Greece, the final outcome is even more uncertain because if Greece leaves the euro, the currency devaluation could be more significant. If Greece were to return to the drachma it is expected that property would immediately de-value by anything up to 50%.

If a sale is agreed currency experts suggest using a forward contract to lock in the exchange rate on the proceeds of the sale in case the euro depreciates further, which many analysts believe is likely.

HiFX's Bodega says: "For people who can't afford to see the euro fall in value, forward contracts are definitely an option to consider."

Due to the current uncertainty in the financial markets, his firm has seen a 69% increase in the number of sellers hedging their currency purchase through the use of one or more forward contracts.

A forward contract means that you agree the exchange rate now and pay a 10% deposit for the amount you need and the remainder after the agreed period of, say, three months.

However, Mr Weston Baker believes people should not sell unless they really have to because the property market will recover and in the meantime they can profit from the rent.

He says: "It is not a good time to sell property whereas the demand for holiday lets is increasing. Many people no longer want to go to a hotel, they want a private villa, so rental incomes are growing."

But some homeowners are feeling vulnerable in other ways.

At Moneycorp, David Kearns, personal client dealing manager, says: "We saw a 100% increase in transactions from euros into sterling in April after people became nervous about leaving their money in European banks. They have more confidence in the UK banking system."

They may also face higher taxes. As many European governments tackle their deficits, second home owners, especially those based overseas, have become easy targets for tax increases.

Mr Kearns says: "Changes in tax laws are always a danger when you buy property overseas."

Despite these drawbacks, there are still people around who are attracted to the idea of buying property in the Mediterranean and there are bargains to be had as a result of the weakness of the euro and lower property prices.

Stephen Hughes, analyst at Currencies.co.uk, says France, Spain, Portugal and Italy are still popular destinations. He suggests potential buyers could gain particularly by buying euros now to take advantage of the pound's favourable exchange rate position.

There are no guarantees that sterling will remain as strong as it is now.

Mr Bodega says: "The overall picture isn't exactly a rosy one. This isn't a tale of a rallying pound and a strong currency based on a robust economy: it's the tale of the economic woes of the eurozone bringing the euro crashing lower. If this were a tale of two sisters, sterling looks less ugly than the euro."