Expat buy to lets are getting more profitable. The rise in staycationing has created an increase the use of properties as holiday lets. Expats are attracted by the potential returns and keen to diversify their portfolios. Existing expat buy-to-let landlords are expanding their portfolios into holiday let. As are would-be investors who dream of owning a holiday cottage that will pay for itself.

As a result, lenders have witnessed a rise in mortgages for holiday let mortgages. Loans for properties that will be rented out on a short-term basis, for at least part of the year to tourists – as a business.

These commercial transactions are not difficult to administer, due to the power of the internet, but like all niche products, they do require a certain level of understanding.

The number of lenders in the expat market is relatively small. Although this is changing. In the past, holiday let mortgages were usually confined to mutual societies. However, in recent years other lenders, including some specialist expat funders, have joined the fray.

So, not the largest selection in the world but certainly enough to find solutions to fit a variety of expat borrowing circumstances.

Recently, there have been reports in the press of landlords turning their buy-to-let property into holiday accommodation.

For the most part, standard buy to let mortgages are designed for use on properties that will be let for a minimum of six months on assured shorthold tenancy agreements (ASTs).

As such, the majority of products do not cater for holiday accommodation. As such expat borrowers risk breaking the terms of the mortgage contract if they let the property out on a short-term basis.

This should not deter expat borrowers, as holiday let terms can actually be far more favourable.

Like to know more?

 Our experienced independent expat advisers are waiting to help you.

Expat buy-to-let, and Holiday let mortgage applications rising all the time

Expat successful mortgage applications are up from 2022 by 16.7%.

It also seems that expat first-time buyers are the ones having the most luck. Over two-thirds of mortgage applications by expat first-time buyers were successful in the first four months of 2023.

The average number of expat enquiries has also risen dramatically this financial year as expats look to get a foothold on the UK property ladder.

Even with all the uncertainty around the world the UK property market is still seen as one of the most lucrative. The majority of working expats living abroad always want to retain and add to their UK property portfolio as markets in other European Countries simply do not return the same profits.

Rising levels of mortgage enquiries, applications and completions shows that a significant number of expat first-time buyers are still both willing and able to get a foot on the UK property ladder.

UK property values remain stable, and rentals are in great demand!  This is a testimony to the long-term potential growth this market offers.

Even with all the uncertainty in Europe and the UK the market remains resilient and profitable, which is why expats see this area as good financial security.

Mortgages are not as easy to obtain as in the past but there are still good options open to the new investor and expats wanting to re-mortgage.

Can we help?

If you are looking to invest in the UK, please do contact us and one of our qualified independent advisers will be happy to assist.

Expats are actively looking for UK property to rent out.

Expats are actively looking for buy-to-let and holiday let properties as demand grows.

Overseas buyers and expats are sizing up the UK property market for potential bargains, taking advantage of the weak pound, according to the latest figures released.

The property portal found that searches for UK property by overseas buyers have grown steadily this year. They now account for 6.2% of all activity on the portal in the first three months of this year, compared to just 3.6% three years ago, an increase of 72%.

It said some investors are keen to capitalise on softening prices and a weak pound and are looking for discounts. This could fuel demand for UK property, alongside expats planning a return to the UK amid uncertainty.

Popular areas

London is in strong demand as the third most sought-after location, but the UK’s regional cities could benefit the most from interest from overseas buyers, with Glasgow and Birmingham the most popular search locations, followed by Manchester and Leicester.

Who is looking?

US house hunters are watching the market most closely, accounting for nearly 50,000 searches in the third quarter of this year, as shown by the list below of the top 3 countries where buyers are searching from: USA, Hong Kong & Ireland.

Owning property in the UK is a goal of many overseas property investors including expats, it’s clear a rise in the proportion of searches for UK property which are taking place overseas since June 2018.

Can we assist you?

If you are looking for a new or re-mortgage do get in contact and one of our qualified independent advisers will be happy to help.

Expats are you contemplating of incorporating your letting business?

If so – Proceed with caution and do get independent advice!

Get sound advice from a group of accountants and brokers alike

Specialists expat buy-to-let brokers and accountants up and down the country are urging expat buy-to-let landlords to tread very carefully and seek appropriate advice before jumping into incorporating their property business into a limited company.

The reduction in mortgage interest tax relief and the introduction of stamp duty are two relatively recent initiatives that have resulted in some landlords reassessing their property businesses and deciding to incorporate.

Lenders are predicting there will continue to be a growing trend towards limited company buy-to-let activity this year. But they warn this may not be the best practice for everybody.

It is understandable that expat buy-to-let landlords want to avoid paying more tax than is necessary, it is essential, as with any investment, that they fully investigate how their personal circumstances apply to buy-to-let taxation.

Many expat landlords are perhaps seeing the headlines and are considering incorporating their property investments, as limited companies are taxed differently to individuals.

Taxation for an expat is a complex issue and landlords should before considering this move seek advice from a tax specialist. This move will ensure that their buy-to-let venture would actually be better off tax-wise, in a limited company.

Help required?

If you are looking for a new or re-mortgage, please do make contact and one of our fully qualified independent advisers who will be happy to assist.

Expat holiday buy-to-lets are getting more popular and profitable.

The rise in staycationing has fueled an increase the use of properties as holiday lets. Attracted by the potential returns and keen to diversify their portfolios, existing expat buy-to-let landlords are expanding their portfolios into holiday let, as are would-be investors who dream of owning a holiday cottage that will pay for itself.

As a result, intermediaries have witnessed a rise in mortgages for holiday let mortgages, i.e., loans for properties that will be rented out on a short-term basis, for at least part of the year to tourists – as a business. These commercial transactions are not difficult to administer but like all niche products, they do require a certain level of understanding.

The number of lenders in the market is relatively small, although this is changing. However, in recent years other lenders, including some specialist funders, have joined the fray.

So, not the largest selection in the world but certainly enough to find solutions to fit a variety of borrowing circumstances. It’s worth noting, that not all sourcing tools list holiday let mortgages in depth so if you are an expat and interested it would be wise to contact an independent broker.

For the most part, standard buy to let mortgages are designed for use on properties that will be let for a minimum of six months on assured shorthold tenancy agreements (ASTs).

As such, the majority of buy-to-let products do not cater for holiday accommodation and borrowers risk breaking the terms of the mortgage contract if they let the property out on a short-term basis.

This should not deter borrowers, however, as holiday let terms can actually be favourable.

Need some assistance?

As an Expat and you are looking for your first mortgage or contemplating a re-mortgage, please do call one of our fully qualified independent advisers who will be happy to help.