By Iain Yule
Property prices in the UK have rocketed in recent years. Base lending rate has been raised again and again, partly to take some of the exuberance out of this market.
It’s now much easier to find out what properties are actually selling for in the UK (as opposed to what estate agents say they are worth). It's also easier to discover how much the neighbours in your street back home actually paid for their house (and not just the advertised price).
This comes courtesy of a service at www.nethouseprices.com where you can see what was paid for property sold in the UK. You can search by postcode and street name to find out which property fetched what price and when.
Once you know the price to pay, though, expats are often at a disadvantage in securing good mortgage deals on UK property purchase. Though lenders may say they do not discriminate between UK residents and expats when reviewing mortgage applications, practical difficulties are often placed in the way of expat purchasers.
Britons abroad have to look longer and harder to find affordable deals for UK housebuying. Problems encountered by expats include having to find much larger deposits than UK-based customers, and higher interest rates and arrangement fees. These come on top of the usual hassles of finding and conveyancing a property purchase from a distance. And lenders may levy early-repayment penalties - making it expensive to switch lenders - and oblige customers to take out life cover and costly in-house buildings and contents insurance.
Research into this market has found that only a few lenders are prepared to offer expats deals on a par with those offered to UK residents. Specialist expat mortgage broker International Mortgage Plans (IMP) now regularly produces a table of the lenders which offer expats the best deals (click here to view this).
IMP's research shows that 60 per cent of borrowers pay too much for their mortgage and don't realise how easy it is to shop around. Many expatriates are currently stuck paying their lender's standard variable rate when there are much cheaper deals available.
It pays not only to secure the cheapest mortgage deal possible when you first purchase, but also to check regularly that you are still getting the best deal.
Expats who are buying or selling property back in the UK can cut out another hassle by handling the transaction electronically. This is thanks to a system of at-a-distance conveyancing developed by Convex. Using the website www.convex.net, buyers and sellers of property are guided through the legal process and can view progress in the conveyancing process online.