The observation comes ahead of the introduction this April of a 3% stamp duty surcharge on UK properties for buy-to-let investors and second homeowners compared with residential buyers.
Kevin White, Head of Distribution at deVere United Kingdom, part of deVere Group, affirms: “More than 70% of all enquiries at deVere Mortgages come from foreign nationals or Britons living and working abroad. The overwhelming majority of these individuals - approximately 45% – are British expats currently residing in Qatar or the UAE or they're nationals from those two countries.
There has been a 60% month-on-month uplift in enquiries from Qatar and the UAE. People based in these Gulf nations are now piling into the British property market. We attribute this rush-to-buy phenomenon to those who, quite sensibly, want to avoid being subjected to the extra levy. No-one wants to pay an extra 3 per cent in stamp duty.”
A series of recently published reports confirm deVere Mortgages’ observations of an extremely buoyant UK property market, with demand at a three-month high.
However, there are extra complications for non-UK residents.
Mr White continues: “Whilst demand for UK property soars, expats and foreign buyers need to be aware that there are extra hurdles that they will have to face.
British expats and foreign buyers should know that they are typically deemed as ‘high risk’ by the vast majority of UK lenders. They are usually ‘red-flagged’ due to a lower UK credit rating as they have lived outside the UK, earned a different currency and worked for a non UK-based firm. This is often the case even for those who have substantial assets and/or a high, stable salary.
They also need to consider other important factors including the pitfall of wasting money on excessive rates and the ability to reclaim tax within 18 months.
Therefore to avoid wasting time, effort and money, it is recommended that expats wanting to purchase property in the UK seek advice from advisers who have the relevant experience of cross-border financial matters, who will help them fulfil the criteria in an increasingly strict mortgage environment, and who have established relationships with the relevant UK lenders.”
