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Foreign homebuyers sheilded from rising property prices due to weakening pound

Despite house prices climbing considerably over the last year, buyers from overseas currently looking for UK property are saving huge sums due to the weaker pound with discounts as high as £40,000.

The latest research by lettings and estate agent, Benham and Reeves, looked at current property market values and how they compare to this time last year, with the research showing that since February 2022, the average UK sold price has increased by 7.8% to £294,329 today.

Even in a slower London market, the average value of a home has increased by 4.8%, commanding £543,099 in current market conditions.

However, while domestic homebuyers have had to contend with the increasing cost of climbing the ladder, exchange rate fluctuations and a weakening British Pound compared to some currencies have presented an opportunity for foreign buyers to secure a saving.

In February of last year, the average UK house price of £273,066 would have required a buyer from the United States of America to spend $369,459. Today, however, the higher average UK house price of £294,329 would see them spend just $355,079, a saving of $14,381 (3.9%) or £12,161, despite the increased value of UK bricks and mortar.

This saving is even higher in a more inflated London market, where purchasing at the current London average of £543,099 would require them to spend $655,195 versus the $700,993 they would have spent in February of last year, a difference of $45,799 or £38,730.

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Buyers from the UAE have also benefited to the same extent, saving -3.9% or AED 52,717 on their purchase, climbing to AED 167,986 (-6.5%) in London. That’s the equivalent of £12,142 saved on the average UK home or £38,690 on the average London home.

The UK continues to be a popular destination of choice for Hong Kong homebuyers and they too have seen the cost of purchasing a UK home fall, down by -3.3% when compared to this time last year, a saving of HK$95,145 or £10,254.

Again, in London, Hong Kong nationals are enjoying savings as high as 6% on the average cost of a home in the capital, reducing their purchase price by HK$325,801 or £35,111.

However, not all foreign buyers are benefiting to the same extent. The Euro has failed to provide a discount on the average UK house price, with European buyers paying 1.9% more today versus a year ago, while those looking to London are seeing a marginal saving (-0.9%).

Foreign buyers from China are paying the equivalent of £10,868 more today versus a year ago on the average UK home, With Japanese buyers also paying the equivalent of £5,391 more today.

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Marc von Grundherr, Director of Benham and Reeves, commented: “We’re yet to see any notable reduction in house prices and, in fact, the latest sold price figures show that they have continued to climb across both London and the UK as a whole. This demonstrates the tenacity of the property market even during times of economic uncertainty and highlights why so many foreign buyers look to the UK when investing in bricks and mortar.

“We’ve seen a steady stream of foreign interest returning to the market, particularly across London, pretty much since Covid travel restrictions were lifted. However, a weakening pound has enticed them to an even greater extent, as many are now enjoying a substantial discount when purchasing versus the price they would have paid a year ago when property values were lower.”

Source: Property Reporter

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Suffolk BS enhances expat and buy-to-let criteria

Suffolk Building Society has announced a series of product and criteria changes to help brokers place more complex cases for their landlord and expat clients.

Expats and non-UK nationals

Suffolk Building Society will accept applications from first-time buyer expat landlords who are working and residing abroad and who have not owned a property before but who wish to purchase a rental property in the UK.

The Society will no longer require returning expats to spend a set amount of time in the UK before applying for a mortgage. It’s common for lenders to require anything up to two years on home soil but this change allows expats to apply as soon as they return. This applies to both employed and retired applicants.

Non-UK nationals will also be accepted on a joint application where one applicant is a UK national. This means that the non-UK partner can now be named on the mortgage. However, brokers should be aware that affordability will be based solely on the UK national applicant’s income only and they will be required to meet all relevant criteria.

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Support for UK landlords

As well as accepting first time-buyer expat landlords, Suffolk Building Society will now consider applications for first-time buyer buy-to-let properties in England and Wales. Full buy-to-let criteria will be applied including interest cover ratio (ICR) and minimum income. The Society will also run a background affordability assessment.

Landlords wishing to purchase or remortgage their own residential property will now be considered regardless of how many buy-to-let properties they have in the background, as long as the buy-to-let portfolio is self-financing. Previously, the Society had a limit of 10 buy-to-lets in the background but this criterion has now been removed to help landlords.

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Charlotte Grimshaw, head of intermediary relations at Suffolk Building Society, said: “We know our niches extremely well and have a very good understanding of the issues facing brokers in these markets at the moment. It matters to us that we’re there to support those whose circumstances means they need a specialist lender on their side – particularly as everyone faces the uncertainty of the current economic climate.”

By ROZI JONES

Source: Financial Reporter

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Four-day week ‘would not work for mortgage market’ ‒ analysis

A four-day working week is a good idea in theory, but not really compatible with the workload of a typical mortgage broker, according to intermediaries.

Last week saw the publication of the results of a trial into a four-day week, with the majority of firms stating that not only had it improved performance but that they were continuing with the structure.

However, when quizzed by Mortgage Solutions, mortgage brokers were split on the idea of a four-day working week. Advocates argued it had helped them to be more productive, working smarter during the week, though there was scepticism about the impact it could have on delivering adequate service to clients.

Boosting productivity

One mortgage broker who is already working a four-day week is Samantha Bickford, mortgage and equity release specialist at Clarity Wealth Management.

She said that since going self-employed, she has worked on the basis of usually having Frdays off, arguing that it leads to a healthier work/life balance.

“This encourages me to be more productive, work harder and smarter during the week, knowing I am taking a day or even an afternoon or few hours for myself at the end of the week. Especially with those dedicating their weekends to their children and family time, this means you have a day for yourself and your own mental health,” she explained.

Gary Boakes, director of Verve Financial, said that he too had been working a four-day week until recently, noting that he “felt I needed the extra time during the day to work on the business rather than in the evening”.

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Maintaining service levels

Stuart Powell, managing director of Ocean Equity Release, said that while he was all for a four-day working week in theory, it presented a challenge for smaller firms in ensuring such a structure did not impact their customer service levels.

“Many firms give people different days off, however for firms with less than five staff, this may reduce coverage for clients and be an issue in holiday times,” he added.

Bickford agreed that fitting in with client expectations and lender service challenges can make picking working hours more challenging.

She said: “If the working week dictates I need to work on a Friday ‒ for example, if this is most convenient for the client or if the week is so busy it is not possible to take the Friday off ‒ I will of course, but in general I believe a four-day week encourages productivity. I have no qualms about working slightly longer days during the week to have this balance.”

Are we working at capacity?

However, not all brokers believe it is a workable option.

There is “no way” a business that interacts directly with the public could succeed with a four-day week, according to Craig Fish, director of Lodestone Mortgages & Protection, who noted that there are times when even not working on a weekend will have an impact on a broker’s business.

He added: “Lenders could make things easier by improving their systems, but the costs involved to do this are likely prohibitive, so I fear that brokers will find themselves working ever longer hours to ensure that the client is getting a first-class service.”

If advisers are able to do the same amount of work in four days that they were doing in five, then they are not working close to their capacity, suggested Andy Wilson, director of Andy Wilson Financial Services.

He added: “I believe most brokers will work quite long and unsociable hours if they want to meet their own and the business’s targets. I also feel most would exceed the four days just to get jobs done and get cases through more quickly.”

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It might work for other industries, but not mortgages

Dominik Lipnicki, director of Your Mortgage Decisions, said that he was sceptical of how practical a four-day week would be for most businesses, noting that while he was a fan of flexible hours, “our clients would rightly expect to be able to be assisted at the very least five days per week”.

He continued: “I am not sure that many mortgage businesses would be able to afford to hire more staff to cover the extra day and if they did, surely, it is the clients who ultimately pay? I think that for some businesses, a four day week might work but that would very much be driven by the type of business that it is.”

This was echoed by Benjamin Blyth, director of Houz Mortgages, who suggested a four-day week does not really suit the mortgage industry as a whole. “We need the engine running seven days a week, but if a four-day week can be scheduled into rotas, it’s great for staff. I can never tie myself to four days because client demand will always vary across the seven days in a week.”

Working smarter, not harder

While many brokers were unconvinced about the merits of a four-day week, there was near consensus that technological developments had given them more control over the actual hours worked.

Chris Barker, managing director of Manchester Money, said that technology today means brokers can “pretty much work what hours they want, and from wherever they want to be, as long as it fits with their clients’ needs”.

Paul Seed, mortgage and insurance adviser at Mortgages 4 U, noted that meeting client expectations was now more about the response times rather than the hours or days worked.

He continued: “Speed of response, especially with live applications, is increasingly critical to maintain a client’s trust. People want to know that they are in safe and responsive hands.”

Embracing the benefits of flexible working can also deliver a better standard of service, too, some suggested. For example, Kylie-Ann Gatecliffe, director at KAG Financial, said that her firm is smarter now in working around clients, removing the need to pull 70-hour weeks.

She continued: “We actually produce higher results, coming in feeling fresh and motivated. Whilst clients can still have appointments on an evening and on a weekend when required, we plan our diaries so the whole team have a balanced week, rather than everyone being stressed and under pressure trying to juggle life/work balance.”

By John Fitzsimons

Source: Mortgage Solutions

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London’s Luxury Residential Market Booms Defying UK’s Home Sales Slowdown

Even though the UK is now seeing the steepest slump in property prices since the 2008 financial crisis, London’s luxury residences are managing to defy Britain’s housing market downturn, reported The Business Times.

Fifteen homes in Central London valued at £5 million or higher were registered as sold in the fourth quarter of 2022—which is 63% higher than the pre-pandemic average, according to researcher LonRes. “It’s not surprising, therefore, that it tempted would-be sellers to put their homes onto the market,” said Anthony Payne, managing director at LonRes.

UK Housing Market Poised for Disruption

The UK’s housing market is facing a ‘perfect’ storm as it tries to eke out growth while coping with the surging cost of living, hiking mortgage and inflation rates, and the risk of recession.

The result: rapid cooling in property demand and sales activities leading to a selloff in the UK’s housing market.

Let’s look at how much the British housing market and buyer demand have been impacted by current economic setbacks:

  • British home prices slid in December 2022 by the most in 13 years and are predicted to slip by a whopping 20% in 2023 if the UK’s base rate continues to hike, according to The Guardian.
  • The Bank of England has been raising the base since the beginning of 2022 as part of its effort to return inflation to its 2% target level. The bank rate has gone up to an annual rate of 4.0% in February 2023—a jump of 0.5% from 3.5% in December 2022.
  • On the other hand, surveyors registered a net balance of -47% for new buyer inquiries in January 2023, plunging from -40% in December 2022.

In such a circumstance, analysts have unanimously agreed that the UK’s property market is facing more turbulence this year.

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Wealthy Buyers Are Snapping Up London’s Luxury Property

Despite the present economic upset throughout Britain, luxury sales in London are skyrocketing, outshining the UK’s housing market.

But why?

First off, even though the interest rate and mortgage rate have hit an all-time high this year, millionaires and elites are less likely to get affected by the impacts of the increase, as they’re less dependent on borrowing.

Secondly, Britain’s pound continues to tumble sharply against the US dollar, dropping a full cent to around $1.20.

Part of the weakness of the pound sterling is the increase in power of the US dollar which is attracting more international investors and wealthy buyers to flock to London’s priciest homes.

Case in point: In the first half of 2022, overseas buyers purchased 48% of the total luxury home purchases in Prime London—a jump from 13% from 2021.

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That said, the demand for luxury property management services offered by agencies like The London Management Company is getting a push, with ultra-high-net-worth buyers investing in upscale properties in Central London.

Offering bespoke services—from maintenance to upkeep and housekeeping—a class-leading agency ensures a client’s luxury property is well-managed, squeaky clean, and always ready for their arrival.

However, in the final quarter of last year, home sale activities decreased in Greater London due to climbing mortgage rates, soaring inflation, and high base rates.

“The final quarter of the year saw a change of direction,” stated the managing director at LonRes. “We’ll be keeping a close eye on how the market unfolds in the months ahead.”

Wrapping Up

Outperforming Britain’s housing market, London’s luxury houses are seeing substantial growth this year.

Source: Digital Journal

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Capricorn’s Jeremy Law on overseas investment in the UK property market

Following a turbulent 2022, it is reassuring that an upward turn is already being evidenced this year, with many indications that we are getting back on track. But what of international interest in UK property?

The good news is that current market conditions mean there’s a lot to be optimistic about on that front, too.

The UK’s economic struggles continue to see many face a challenging time – but the weaker pound makes UK property investment a particularly attractive prospect. This is especially the case when considering the ability to purchase ‘forward contracts’, enabling buyers to secure a future sum at today’s exchange rate. Indeed, international investors can capitalise on current exchange rates, using currency to their advantage to make the cost of a deposit far lower than at other times.

Added to this, with some domestically choosing to defer a property purchase until we are sailing in calmer economic waters, rental yields are on the rise. Suggestions are that rents are up 15% to 20% year on year, which makes for a good investment case when buying to let from abroad. It is true that mortgage costs may have gone up – but these are being more than balanced out by higher rents, meaning earning potential in this area is now considerable.

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Meanwhile, November marked a turning point for fixed mortgage rates, which began to fall. This is not to say they are back at the levels enjoyed before, but they are moving in that direction. The market is normalising, meaning rates will go up and down, and we are back in a position where buyers can take advantage of current offers, which remain lower than historic averages.

Another advantage of the unprecedented events of last year is that some lenders have reduced the margin on their tracker products, making them a more attractive long-term play. In general, lenders have been forced to innovate and there are now a variety of options in terms of mortgage deals to suit different needs, with brokers playing an increasingly important role in helping customers find the best products for them – especially when looking from abroad, where the right lender options can be more challenging to find.

Added to this is the fact that there are many more lenders in the market than there were just a year ago. This has the effect of keeping competition healthy, encouraging further innovation of products and policies – including, for example, offset products and products that offer greater flexibility. There is also an additional incentive for lenders to keep prices low (or at least lower than the competition).

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There are a number of factors that mean international interest in UK property is on the rise – a final one being that lenders are marketing to Chinese buyers again. With China opening up again following its zero-Covid policy, more Chinese property investors are likely to be able to travel to the UK to visit properties, along with their Far East neighbours – naturally increasing potential for investment.

There is no doubt that the last 12 months have been something of a rollercoaster ride for the market – but the fallout has undoubtedly created fertile ground for overseas investment in UK property, and this is a reason for positivity.

By Jeremy Law

Source: Property Week

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Double stamp duty surcharge for overseas buyers to ‘level’ UK property market for locals, urges lobby group

The UK government should double the stamp duty surcharge overseas buyers must pay when purchasing a property in England, an industry lobby group has said.

The National Association of Property Buyers (NAPB) said doubling the stamp duty surcharge would “level the playing field” amid an influx of “wealthy foreign buyers”.

Under current rules, overseas buyers must pay an extra two per cent surcharge for a house they are going to live in, and an extra five per cent for any property that will not be their main home.

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However, the lobby group urged the government to double the two per cent surcharge, in arguing foreign buyers from “high income and low tax locations” are pushing up UK property prices.

The group added that the “collapse in sterling” after Liz Truss’ mini-budget created a “huge discount” for overseas buyers as it warned an increase in the surcharge is needed to fix housing “inequalities”.

Jonathan Rolande, a spokesperson for the NAPB said: “Foreign ownership is reducing available stock in the sales and rental sector and pushing up prices”.

He noted that hiking the surcharge would also “bring in additional funds for the treasury” as he said the UK government needs to “think bigger” in their approach to the housing market.

The calls come as figures show almost 250,000 UK properties worth a combined sum of £90.7bn are currently owned by overseas nationals.

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London continues to be the top destination for foreign buyers, with 85,451 properties in the UK’s capital owned by those from overseas.

Inside London, Westminster remains the top destination for overseas buyers, with £1.8bn worth of homes owned by foreign owners, while Kensington & Chelsea took second place with £10.7bn.

By Louis Goss

Source: CITY A.M.

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The Perfect Rental Storm Continues for UK Expat and Foreign National Investors

A shortage of rental homes and huge numbers of renters in the market are combining to create the perfect rental storm for UK Expat Investors.

The ‘Perfect Rental Storm’ continues for UK expat and foreign national investors in 2023 as a shortage of rental homes combine with huge numbers in the rental market to make for a very profitable rental landscape.

Shortage of Rental Homes

There are currently less than half the normal number of homes available to rent at the moment and this is contributing to fast-rising rents. This equates to the typical estate agent having only 8 available rental properties. The pre-pandemic average was 16, which shows how much rental availability has suffered in recent years.

The low number of rental homes is being driven by high consumer demand and high mortgage rates, which mean that prospective buyers are struggling to get onto the property ladder and are consequently stuck in the rental market. This situation means that rental prices are rising quickly amidst fierce competition. In practice, the average rents for those starting a new tenancy have risen by 12% in the last year.

With cities proving even more popular in the rental market, places like Manchester, Birmingham, and Cardiff have risen as much as 15%. Even renters who are choosing to stay put are facing increases of around 4%. This is largely because many existing renters are in fixed-period rental contracts and landlords aren’t looking to increase prices in a bid to maintain tenancies. Because of the much lower price-increases for renters who stay put, many renters are choosing to stay where they are to avoid risking higher rents. According to data from the English Housing Survey, the average length a renter stays in a property has now risen to 4.4 years, which is up from only 2.7 years in 2012. This means that the flow of available homes into the market is very slow and is further exasperating supply constraints.

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Sky High Rental Numbers

In addition to the shortage of rental homes, there are also sky high numbers of people in the rental market, with the proportion of people in the private rental sector jumping by 28% in the last ten years. According to the government’s latest housing census, 5 million households are now renting their home in the private sector. This is likely a result of affordability constraints caused by house price growth and lower first-time buyer numbers, as well as many of the factors mentioned above. Crucially, the number of households has also increased, with the number of new properties being built not matching this increase.

The huge numbers of households renting at the moment is good news for UK expat and foreign national investors, as the shortage of rental homes is being further exasperated by ever-increasing numbers of renters. These factors will both contribute to constant increases in rental incomes and rental yields, meaning big profits for UK expat and foreign national investors with the right property.

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What Does This Mean for UK Expat and Foreign National Investors?

‘The problem of high rents and low rental availability is unlikely to go anywhere as a huge increase in rental supply will be difficult as a result of higher borrowing costs and regulatory changes’ says Stuart Marshall, CEO of Liquid Expat Mortgages. ‘But for those who do manage to invest in property, the rewards are likely to be huge. The number of households in the rental market has grown massively over the last ten years and it’s likely to keep growing, with the number of new homes being built continually falling short. Rental demand is consequently bound to stay high, and this will feed big profits for UK expat and foreign national landlords.’

‘Competition is also lower for UK expat and foreign national landlords who choose to invest in UK property now. This is due to new tax and regulatory changes in the buy-to-let sector which have impacted landlords’ bottom lines and contributed to lower levels of investment into the rental sector. In turn, this has contributed to landlords selling their existing rental properties as investors look to cash in on capital growth profits, especially given the massive price rises in the last few years.’

‘While there are obvious difficulties for UK expat and foreign national investors to navigate when investing in UK property, things are not as difficult as they once were’ says Stuart Marshall. ‘The advent of specialist UK expat and foreign national mortgage brokers has been a hugely positive change for many UK expat and foreign national investors as these brokers can help investors to navigate the inherent difficulties of investing in UK property. Not only will they help to smooth the process and make completion as quick as possible, but they can also help to advise UK expat and foreign national investors in the process of choosing a property for their specific investment goals.’

To maximise the quality of the investment, UK expat and foreign national investors should keep abreast of the popular types of property and what is appealing to renters at the moment. In the most recent housing census, it’s clear that the popularity of flats has seen a huge increase over the last few years, with 500,000 more households living in flats compared to ten years ago. This demand for flats also lines up with the popular properties for UK expat and foreign national investors at the moment. Namely, energy efficient properties with lower management and running costs because they can assure a stability of rental income. In fact, much of the recent focus for UK expat and foreign national investors is shifting away from capital growth and back to solid rental incomes. This is because the rental market is booming but huge rises in property value over the last few years have contributed to low capital growth potential. City centres have also become incredibly popular for renters, which again favours flats in the rental market. Flats are also highly mortgageable, which is good news for UK expat and foreign national investors, as there are a range of excellent UK expat and foreign national mortgage products available at the moment.

Source: EIN News

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A buyer’s market for UK with demand from overseas purchasers

One Global Group predicts that the United Kingdom (UK) will experience a return to the buyer’s market in the coming year and that demand from Malaysia and other international markets will increase even more.

The company is optimistic about 2023 since the year’s market circumstances would be perfect for foreign purchasers wishing to buy a home in the UK.

“We’re seeing buyers from across Asia purchasing in UK locations that are offering the best value for money,” said Eli McGeever, director of research and technology innovation at One Global Labs.

“What ties these investors together is that they’re all purchasing for one of these four reasons, which is as a place for somewhere for their children to live while studying, as wealth preservation, to diversify their assets, or they are immigrating and need a home to live in,” he said.

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According to McGeever, although borrowing rates are higher than they were earlier this year, purchasers have a lot more options because there are still currency gains to be had and rising house inventory levels.

“That being said, buyers in Hong Kong have a broad interest, due to the diversity of buyers, from seasoned investors to BNO buyers looking to purchase a home to live in. There are many more types of properties demanded compared to a few years ago. These can range from apartments in inner London, to detached/semi-detached homes in the Home Counties.

“Hong Kongers have also been strong buyers in regional powerhouses, such as Manchester and Birmingham. Whereas buyers in Singapore and Malaysia are still more interested in London,” he said.

McGeever said there are five key areas that are going to make 2023 a buyer’s market and the ideal time for investors in Asia looking to purchase a home in the UK.

“These are price corrections in some markets, more home inventory, strong rental price growth, favourable exchange rates, and, mortgage rates lowering,” he said.

McGeever said that following the unsustainable real estate buying frenzy of the previous two years, sales volumes have returned to pre-pandemic levels.

Although costs are still rising in much of the UK on an annual basis, he said that they have started to decline in select markets.

“What’s likely to happen next year is that prices will correct by a couple of percentage points in some markets while staying pretty level or rising in others. Each city has its markets. For example, areas in London such as Harrow, Hounslow, and Newham will likely outperform the market, as will areas in Manchester, such as its city centre,” he said.

McGeever said that the housing stock is finally increasing, which will bring the real estate market some much-needed equilibrium.

He said that a lack of available housing has contributed to the dramatic price growth that has occurred since the Covid epidemic began.

According to him, building more homes will assist to slow the price increase.

The housing stock has increased by 40 per cent over the last year, according to Zoopla. But inventories are still 19 per cent below levels from 2017 to 2019.

According to McGeever, rental costs have increased quickly in the UK over the past year, and he doesn’t think this trend will slow down in 2023.

He said the high rental costs will probably encourage more people to look into purchasing a home, particularly first-time purchasers who would prefer to increase their equity in a brand-new residence.

“Investors who are looking for a buy-to-let property should not be concerned about demand weakening anytime soon. We expect the Pound Sterling to remain below rates seen only a year ago. This provides savings over any expected interest rate rise. However, One Global Group expects the Pound Sterling to strengthen for 2023 so early movers will benefit,” he said.

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Pent-up demand in off-plan projects

McGeever said that interest in off-plan projects has increased.

Buying off the beaten path enables purchasers who need financing to secure a mortgage close to the project’s completion date, he said.

He said this is a smart choice for people who anticipate that the interest rate will drop in 12, 24, or 36 months.

“Property developers are also currently offering more competitive pricing and lower deposits. This trend is expected to continue in the year to come,” he said.

According to him, notable projects in the UK with strong buying interest from overseas buyers include Graphite Square (Vauxhall, London), Fulton & Fifth (Wembley, London), and One Victoria (Victoria District, Manchester).

Graphite Square is a residential development by Third.i Group in London’s Vauxhall.

“The residences are just a short distance from the River Thames, the West End, Battersea Park, and Chelsea, so residents are never too far away from your next adventure in the capital. Prices start from £735,000 in the loft-style residences akin to what you might find in New York City’s Manhattan,” he said.

Fulton & Fifth, the newest development from Regal London is an upscale, “live-work-play” Wembley Park project comprising five apartment blocks set along Wealdstone Brook that will hold more than 800 homes on completion in early 2025. Prices start from £440,000.

One Victoria is a development by One Heritage Group PLC. Set over two blocks, it fronts Great Ducie Street. One East is a 14-storey building with 84 apartments while One West is 10 storeys high with 45 apartments, with prices starting from £199,000.

By Kathy B

Source: New Straits Times

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Overseas buyers will help avert a property market crash – claim 

A property tax consultant has hit back at suggestions of a housing market crash, suggesting that overseas investors will help sustain growth.

David Hannah, group chairman at Cornerstone Tax, has predicted that price growth will slow but said he is confident that it won’t turn negative.

It comes as a survey of 2,000 people by the firm found 55% were not deterred from purchasing property in 2023 – compared with 45% who said they would halt proceedings.

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Hannah said the 55% who will follow through with purchases in 2023 will most likely be buyers who are less dependable on interest rates.

Foreign investors will also seek to take advantage of the fall in the price of sterling, essentially, making the UK housing market 10% cheaper, he said.

He added that the 45% that will hold off on purchasing will be most likely first-time buyers, who now cannot afford the inflated mortgage payments.

Hannah said: “In early 2023 we will see slow demand. Only those people that are forced to sell will see a small fall in prices, however, over the whole of 2023, I expect to see low to mid to single-digit growth over the UK property market- between 5-8%.

“Despite the negative headlines we have been seeing, there is an underlying pressure on the market and that is leading to upward pressure on prices.

“We now have a growing number of people that want to move to the UK.

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“The first is the overseas investor who regards UK property as a safe haven for their money because the country they principally live in is not economically or politically safe.“The second are those who want to become second homeowners. The third and final group is those who want to leave their country of birth and are in need of a home.”

He suggests all of these factors over the course of the next 12 months will support the market, adding: “There will be no crash and no 10-20% fall in property prices that we saw in the noughties. The UK property market has tended to be more stable than any other global market in property.”

By Marc Shoffman

Source: Estate Agent Today

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Foreign property investors must be registered, says government

The government is urging all overseas entities who own property in the UK to register at Companies House.

The Register of Overseas Entities came into force in August this year and requires all entities in scope to register with Companies House before the deadline of January 31 2023. The registration process involved them declaring the beneficial owners and/or managing officers for properties in this country.

As the deadline nears, Companies House is urging overseas entities and agents to register in good time and avoid some common pitfalls.

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To make sure registrations are processed quickly, Companies House is recommending that agents  work with their clients to make sure all the information is correct before their registration is submitted , to file as early as possible before the deadline of January 31, and for agents to file on behalf of their clients – it’s likely to be easier and quicker for them than for the clients.

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Overseas entities must register on time to avoid prosecution or civil financial penalties. Overseas entities that fail to register will also find it difficult to sell, lease or raise charges over their land. 

Rachael Watts, Head of Register of Overseas Entities at Companies House, says: “We have seen a significant number of filings rejected with most of these due to errors in the agent information section. Common errors include the registry name being abbreviated or incorrect, and inconsistencies in the agent’s name, overall person with responsibility, address, and email address.

“By minimising these errors and registering in good time, overseas entities and agents can avoid running into issues later on.”

By Graham Norwood

Source: Letting Agent Today