British expats are dropping their homes overseas and are preparing bolt-holes back home as Brexit uncertainty starts to bite.
Despite reassuring leaks from Whitehall that British expats in the European Union will keep their residency and jobs status once the UK exits the EU, financial firms report an exodus home may well be underway for many.
Currency transfer firm Moneycorp says British expats are buying fewer homes abroad compared to a year ago.
Rather than buy, more expats are selling their homes due to Brexit worries and fears that the value of a weak pound may drop further and eat into any profits from house sales.
Unsure about expat status
The firm estimates customers account for around 10% of money transfers for British expats.
“There has definitely been a big trend back in from euro to sterling,” said CEO Mark Horgan. “For us that is bad news because it probably means its people selling up and exiting the market.
“New completions are off by about a quarter year on year. You can understand why that would be the case. You clearly have hesitancy from Brits who are unsure of their status after Brexit. The question is whether those are lost or delayed purchases.”
Meanwhile, Skipton International, the Guernsey-based overseas arm of the Skipton Building Society revealed expats have completed 600 buy to let mortgages with the firm worth around £100 million since 2014.
Increase in mortgage demand
Since September, expat buy to let mortgage inquiries are up 80% – with the Gulf States leading the way.
“This year up to September, buy to let mortgage inquiries from British expats in Kuwait increased by 130% on those for 2015, while doubling in Oman and rising 37% from the United Arab Emirates,” said managing director Jim Coupe.
“We experienced a similar increase in demand from expats in Europe, with double the number of enquiries from Spain, and substantial increases from Germany, France and Switzerland.
“Most British expats buy property in the UK as a long-term investment. While the rental from a property services the mortgage, the capital gain tends to be much more important for expats thinking about buying a property.”
