News & Insights

Number of Expats looking for buy-to-let property increases

New figures from Liquid Expat Mortgages show that enquiries from expats seeking buy-to-let mortgages were up by 90% in 2017 when compared with the previous 12 month period.

There are a number of reasons why the UK has become popular with landlords living overseas. Firstly, the weaker pound has made buying British property a much more cost-effective option compared to buying in other countries. (Property prices have largely been unaffected by the Brexit result but this has meant there are fears that some British expats may face a shortfall if they find they need to sell their overseas home and are forced to buy property again in the UK.)

Also, paying off a mortgage in the UK is the cheapest it’s ever been. Interest rates have been at an all-time low recently, only rising for the first time in 10 years at the start of November when the Bank of England’s Monetary Policy Committee (MCP) increased rates from 0.25% to 0.5%. The low interest rates have made the British property market a very attractive investment opportunity for those living overseas, but whether this increase from the MCP will impact the number of expats wanting to invest in buy-to-let property remains to be seen.

The managing director of Liquid Expat Mortgages, Stuart Marshall commented that until recently very few offered mortgages to expats, but this has now changed as the demand has increased.

“Many expats are keen to keep a foothold in the UK and the yields on buy-to-let properties in the UK are far ahead of those offered by other countries,” Marshall said.

He also noted that the rise has happened even though the UK government has introduced measures to discourage people making buy-to-let purchases, such as the second home stamp duty, which was devised to give first-time buyers less competition in the market, and increased stress testing on buy-to-let mortgages.

If you’re intending to join the growing number of expats experiencing the benefits of owning a buy-to-let property in the UK, there are some important considerations you should make first.

Purchasing a buy-to-let property is a significant investment that will play a big part in your financial planning portfolio, and it’s one you shouldn’t enter without proper guidance from a financial adviser.

Blacktower financial advisers can help you make the most important financial decisions you’ll face in your life. We can offer expert advice in a number of matters to help you prepare for the future, including investment advice as well as offering advice on pension planning and life insurance for expats. Speak to an adviser today.

This communication is for informational purposes only and is not intended to constitute, and should not be construed as, investment advice, investment recommendations or investment research. You should seek advice from a professional adviser before embarking on any financial planning activity. Whilst every effort has been made to ensure the information contained in this communication is correct, we are not responsible for any errors or omissions.

Other News

European Union PEPPs to go Before Parliament

European Parliament, StrasbourgAccording to reports emanating from Bulgaria, expat pension choices may be about to become broader and more accessible with the likely introduction of the European Union PEPP.

PEPPs – Pan European Pension Products – are understood to be at the draft stage, with regulations set to be examined by European Parliament for possible approval.

The development of PEPPs has come about as a result of a perceived need to give people greater choice when it comes to planning their retirement pensions, particularly given that there is not equality of options for retirement savers across the continent. It may also help address the fact that, according to the EU, only 20% of workers between the ages of 25 and 59 make regular pension contributions.

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