Here we are at the start of 2018 and since the Brexit result was announced 18 months ago, it does not appear to have had much of an impact on the overseas property market, according to Simon Conn, the UK’s leading overseas property professional & financial advisor (www.simonconn.com).
He said: “People have seen Brexit as an inevitable – it is going to happen, but no one is sure what form it will take." As yet, it has not had a major impact on my business. A few people have come back to us who paused because they do not want to wait anymore, but others recognise the opportunity to purchase properties at good prices.
“With stage one of Brexit complete, more upbeat comments about the future of UK nationals living in Europe has added to a more positive outlook. Coupled with the historically low interest rates, people have been moved along to make a decision now, especially as rates in some countries are starting to increase,” Simon added.
Simon’s predictions for this year’s property hot spots are:
Portugal
Portugal has always been a popular country with Brits looking to buy abroad and is Simon’s number one recommendation for this year.
A lot of people are recognising the good value for money, nice weather and ambience of Portugal when compared to other Mediterranean countries. It is not as stiflingly hot as some places as it is mostly on the Atlantic coast rather than the Med and there is also the Golden Visa programme and other tax benefits which are available to retired people.
Mortgages are available up to 80% loan-to-value, although better lending terms are available for loans of 70% or less. The most popular areas include the Algarve and the Silver Coast north of Lisbon, but there has been more interest for Madeira and even the odd enquiry for The Azores. Interest rates are currently available from approximately 1.75%-2.00% above 12 month EURIBOR (the interest rate at which some European banks lend funds to one another, where the loans have a maturity of 12 months).
Spain
Spain continues to be popular with its great weather, Mediterranean coast and laid back lifestyle. Holiday home and investment purchases seem to be increasing. Mortgages are available up to 70% loan-to-value (better lending terms are available for loans of 60% or less). Interest rates are currently available from approximately 1.50%-2.00% above 12 month EURIBOR.
Ireland
Simon predicts that increasing interest will be shown in Ireland this year, although it can still be quite difficult to get a mortgage and the lending criteria is strict. The maximum loan-to-value for holiday homes and investment properties is 60%, and interest rates are from 4.60% variable.
France
As usual, France will remain in the list of top countries. Transport links from the UK are excellent so it is easy to get to, and it offers a more relaxed lifestyle with fewer people and better weather. Mortgages are available up to 80%-85% loan-to-value (better lending terms are available for loans of 70% or less). Interest rates are currently available from approximately 1.50%-2.00% above 12 month EURIBOR.
USA
Interest in the USA has waned a bit since the Brexit vote and the exchange rate between the US dollar and the pound has led to a reduction in the number of potential purchasers. Popular areas include Boston, Fort Lauderdale, Miami, Orlando, Tampa, New York and other parts of the East Coast. West Coast destinations are always of interest, including San Francisco, Los Angeles and Seattle. Maximum loan-to-value rates are 70% (up to 75% in Florida) and interest rates are from approximately 4.50% fixed for 3 years, or 4.875% fixed for 5 years.
Other popular countries include Canada, Germany, Holland, Italy, Malta and parts of the Caribbean. All are sought after by holiday home owners and as potential retirement homes.
The Canary Islands and the Balearics are becoming more popular, with loan-to-value rates similar to those of mainland Spain.
The economic climate means that finance packages for Greece are very difficult, unless the property is valued at €2million or above.
The market in Cyprus is a bit more buoyant and loan-to-value rates are 60-70% with a minimum loan of €50,000. Be vigilant about local legal and title issues.
“There does seem to be a growing interest in more exotic destinations – not seen since the last world economic crash, including places such as Argentina, Brazil, Cape Verde, Ghana, Morocco, Tunisia and even Sao Tome, off the coast of Angola,” Simon said. “However, with the majority of these countries, mortgages for non-locally based nationals are very difficult, or not even currently available, plus it is imperative you take the necessary independent legal and valuation advice before signing any sale contracts.”
He added: “If you are looking to buy abroad for investment purposes, note that rental income is not usually taken into account. Mortgages are normally based on a client’s ability to repay the mortgage, overall personal financial profile and the valuation of the property.”
About Simon Conn
I have over 35 years broking experience in the overseas property market and have worked successfully during that period for a number of major financial services companies.
I also have a strong media profile as an established industry expert on matters relating to the purchase or refinancing of overseas property and often advise on consumer protection matters.
Through my many connections within the overseas property and finance industry, I have developed a worldwide network of leading specialists to assist with local issues such as legal, insurance and currency exchange.
What services can Simon currently offer?
INTERNATIONAL RESIDENTIAL MORTGAGES - With his long-term connections with specialists and lenders in the Overseas Mortgage Market, Simon liaises with them to source a required residential mortgage (purchase and re-mortgages) in any one of the 50+ countries worldwide they currently operate in.
Maximum loan to values and interest rates will vary from country to country and will be based on at least the following:- purchase price/valuation, amount borrowed, loan to value and an applicant’s personal financial status/credit history.
COMMERCIAL MORTGAGES - Through his extensive financial contacts, Simon can facilitate the required funds for commercial mortgage projects both in the UK and selected countries worldwide, assuming that there are ‘bricks & mortar’ available as security and that a feasibility report/ executive summary is provided at the outset (where required).
Currently I have access to commercial finance available on the following basis:-
UK - minimum £ 50,000, no maximum
Australia, Canada, Cyprus, France, Germany, Italy, Malta, New Zealand, Portugal, Spain, Switzerland, Turkey and the USA - minimum normally € 2 million, although possibly can consider lower amounts on a case by case basis
Other countries (except War Torn areas) - minimum € 10 million
COMMERCIAL MORTGAGES (cont’d) - Maximum loan to values and interest rates will vary from country to country and will be based on at least the following:- purchase price/valuation, amount
borrowed, loan to value, an applicant’s financial status/credit history and feasibility report/business plan (where applicable)
CURRENCY EXCHANGE - Through his partnership with one of the world’s leading foreign currency firms - Moneycorp - Simon can introduce you to experts who’ll provide advice on how to transfer both lump sum or regular payments at the most advantageous/competitive exchange rates available at the time required.
LEGAL SERVICES - During his many years of working in the overseas property market, Simon built up an extensive network of specialist legal contacts who can advise on the purchase or re-financing of overseas property, both residential and commercial. Simon can introduce you to the contact who is the most appropriate for your own circumstances.
INSURANCE SERVICES - Simon also has contacts with companies which specialise in the insurance of overseas building and contents, title insurance (which could protect against future problems with the property) and legal expenses cover.
PROPERTY TAX ADVICE - This is available in a number of selected countries, for those who own a residential property overseas and are not aware of the possible tax implications of owning such a property, even it is for holiday or future retirement purposes.
ALSO AVAILABLE - A specialist consumer protection facility – this is to assist a client(s) in resolving problems which may have occurred either when purchasing or owning an overseas residential property.
Simon Conn is registered under the approved persons regime with the Financial Conduct Authority under individual reference number SLC00026. Please note that the FCA does not regulate all forms of our mortgage activity. As a mortgage is secured against your home, it could be repossessed if you do not keep up the mortgage repayments. If a mortgage is denominated in a currency other than your home currency, there is a risk that changes in the exchange rate may increase the equivalent value of the debt in terms of your home currency. We will provide you with a free initial consultation and we will always explain exactly what you will be charged before you choose to proceed with an application. As we offer a bespoke service our charges can vary and the actual amount payable will be shown on any eventual quote and will depend on the country where you require finance, plus your personal circumstances and loan requirements.
