Overseas buyers and British expats are finding it increasingly difficult to purchase property in the UK without correct advice, according to deVere Mortgages.
The firm’s observation follows the recent introduction of new tougher requirements for buy-to-let borrowers by UK lenders.
Darren Mead, deVere Group’s head of mortgages says that expats and investors from the Middle East, Asia, Europe and the US all play a ‘hugely important’ part in the UK’s property market.
Since last year’s Brexit vote, Mead says these demographics are finding UK property investment more attractive due to the relative weakness of the pound.
“In our experience these buyers, without seeking quality advice first, are finding it increasingly difficult to purchase property in the UK, often being turned away by mainstream, high street lenders,” says Mead.
“Expats have been typically deemed as ‘higher risk’ by UK lenders, even if they have substantial assets and a high salary.”
He argues that these borrowers need to work with advisers who specialise in home loans for those living outside of the UK.
“This is because more common lenders now require borrowers to receive a minimum of 145% of their mortgage costs in rental income. Previously it was 125%.”
“This change to lender affordability criteria, could have a potentially significant effect on the UK’s property market for expat buyers if they are not made aware prior to making a mortgage application,” Mead concludes.