A flurry of foreign and expat buyers are snapping up luxury London homes – and the signs are lenders are rushing to help them with new mortgage products.
Data from leading international property consultant Hamptons International revels 57% of prime homes sold in the capital in the last six months of 2018 went to buyers based overseas.
The firm says business is booming with foreign investors – and the latest data shows the highest number of prime home sales to non-British buyers in Central London since 2012.
Spokesman Aneisha Beveridge highlights the weakness of the pound as the main reason for the rise in sales as buyers are effectively picking up a discount on foreign currency exchange rates.
“A property that would have cost a buyer from the European Union £1 million in the first half of 2016 effectively cost £124,000 less in the second quarter of 2018 due to sterling’s depreciation,” she said.
Mortgage lenders are quickly stepping in to provide loans for expats and foreigners buying British homes.
Skipton International has stepped up lending by opening buy -to-let mortgages to foreigners as well as British expats.
Roger Hughes, the lender’s business development manager, said: “We have continually refined our UK buy-to-let offering and will continue to search out ways in which we can make our products more readily available and inclusive.
“This development considerably widens the pool of clients to whom we can now offer lending and makes us one of the most competitive players in the UK buy-to-let market for overseas residents as there are only a few lenders that can offer UK buy-to-let mortgages to non-UK nationals.”
The lender offers loans of up to £300,000 as three and five year trackers starting at an interest rate of 3.24%.
Expat buy to let mortgage deals
Mansfield Building Society has two expat buy to let mortgages for loans of up to £500,000 at a rate of 2.79% discounted for two years. The loan terms include a maximum 70% loan to value and a 1.25% completion fee.
Cambridge Building Society has new five year fixed (3.49%) and two year discount (2.89%) buy to let loans for expats at 75% loan to value. Both have a £499 application fee and £1,500 completion fee.
Tipton & Coseley Building Society has four discount and fixed rate mortgages for expats with a maximum loan limit of £500,000 at 70% loan to value.
Cammy Amaira, director of sales and marketing, said: “There are an estimated 5.5 million expats with an increasing number looking to start or add to their buy-to-let portfolio in the UK.”