Many UK expats and foreign nationals are still looking to invest in UK property. And this is not surprising with the UK rental market predicted to keep growing.
Despite the turbulent times and the impending closure of the UK’s stamp duty holiday, UK expat mortgages and foreign national mortgages are still available for those looking to invest in UK property. And investing in UK property is one of the best financial decisions you could make.
An Appetite to Invest Amongst UK Expats and Foreign Nationals.
The extremely busy UK property market in 2020 has continued throughout the start of 2021. According to Rightmove, the UK’s number one property portal, 2021 saw the busiest ever start to a year in the property market (30% up from the start of 2020). Rightmove also predicts that the 2021 housing market will continue to perform strongly, with the number of prospective buyers contacting estate agents 53% higher than the same point in 2020.
There is a particular appetite to invest amongst UK expat and foreign national investors. According to a survey conducted by multinational law firm DLA Piper, 75% of investors are planning to invest in European residential properties in 2021. The respondents also ranked the UK as the number one spot for investment, indicating that the strong uptake of UK mortgages from UK expats and foreign nationals will continue through 2021. And overseas investors are particularly excited by the current conditions in the UK where there is a high demand for rental properties, property prices remain enticing, and the rental yields from properties are strong.
Years ago, major lenders had a monopoly on international property buyers. This meant that purchasing a UK property from overseas involved navigating extensive paperwork, salaries paid in a foreign currency and the lack of a UK credit history. However, nowadays expert mortgage brokers have access to a much wider range of products than those presented by mainstream lenders. This means that many of the difficulties involved in getting a UK mortgage as a UK expat or foreign national are now a thing of the past.
To find out more about how we can assist you with your Expat Mortgage requirements, please click here to get in touch
The Strength of the Rental.
Traditionally, the UK rental market is very resilient. While the housing market remains steadfast, the rental market has also performed at consistently high levels. For example, in the aftermath of the global financial crisis, house prices fell 18% compared to only a 2% fall in rental prices (as reported by Savills, one of the world’s leading property advisers). This is a promising sign for UK expat and foreign national investors who are looking to invest, as even in the most turbulent circumstances, rental prices remain relatively resilient. And the outlook remains strong for the future too, with Oxford Economics predicting a 13.6% rise in UK rents by 2024.
‘The current conditions for investment remain solid, with Oxford Economics also predicting that the Bank of England’s base interest rate will remain at the low of 0.1% until Q2 of 2022. Consistently low interest rates also mean that there is a strong potential to make money from good capital growth on your property too.’ So, where should you invest?
Where to Invest.
‘The picture is clear on where to invest. The North West leads the pack with a projected growth of 24.1% over the next five years. This is followed by Yorkshire and the Humber, with a predicted 21.1% growth and Scotland which is predicted to grow 20.1% over the next five years. The rental growth picture is also strong in these areas. For example, according to JLL’s research, Manchester is predicted to have a rental growth of 7% by the end of 2022.’
Manchester is England’s fastest growing city with its population predicted to reach 600,000 by the middle of the 2020s. The surrounding area of Greater Manchester has a further population of almost 3 million people who support the economic and social infrastructure of the city. With a £7 billion investment from the government as part of their Northern Powerhouse scheme, Manchester’s infrastructure is bound to keep on growing and attracting more young professionals looking to both live and work in the city.
‘For UK expats and foreign nationals, Manchester presents such a strong investment opportunity. All the factors mentioned above are sure to stimulate demand and make sure that supply is kept low – thereby driving continued capital and rental growth. The city and surrounding suburbs are currently undergoing a rapid period of growth and change. The availability of UK Expat and foreign national mortgages, coupled with the incredibly low base interest rate from the bank of England, means a great range of mortgage products to choose from and, as such, it’s an excellent time to invest.’
Source: EIN News
Discover our Expat Mortgage Broker services.