Overseas Mortgages  The Basics

Overseas Mortgages

When purchasing a property abroad, the issue of financing becomes slightly more complicated, for further information click here...

Get a Free Quote Introduction to Overseas Mortgages

When purchasing a property abroad, the issue of financing becomes slightly more complicated. Different countries have different regulations which will need to be considered, as well as the potential financial implications of paying a mortgage and receiving income in a foreign country.

Why Obtain an Overseas Mortgage
In many cases, the only way to finance a foreign property purchase will be to do so through a foreign broker or insurance company. By purchasing a property abroad, an investor is in the position of extending their portfolio to take account of potential rises in capital values in less developed countries.

Overseas Investment Strategies
This strategy is ideal for the investor who believes property prices in the UK are at a particularly high level and wishes to invest in property in countries that are yet to reach similar high levels. Identifying an overseas hotspot requires a different level of expertise and a broader understanding of the property market, in general, compared with locating the current UK hotspots.

Investors should take into account the following potential issues:
Bullet Point EU membership: historically, countries that are about to join the EU have seen a dramatic increase in prices, particularly as they gain accession. Prospective property owners and holidaymakers are much more inclined to consider an EU country as it is seen as more politically stable and, therefore, a better investment option. Those who are prepared to take a risk pre-accession can potentially make huge financial gains;
Bullet Point Budget accessibility: improving infrastructure links including new budget airline flights will have a significant impact on the popularity of an area. When Ryanair began to fly to the southern parts of France, to destinations such as Montpellier, the house prices in that region doubled in a matter of two years, far outperforming other areas, so stay abreast of flight developments; and
Bullet Point Political and economic stability: consider political and economic developments that are happening in your chosen country. Although a politically unstable country offers a large degree of risk, there are also potentially huge gains to be made, provided the country becomes more stable, in time.

Summary
Bullet Point Obtaining a foreign mortgage is one of the key ways to invest in an overseas market;
Bullet Point investing in property in a foreign country requires an entirely different approach and a range of new considerations that are not applicable for property investments in the UK;
Bullet Point there are huge potential gains to be made by investing in foreign countries, but it is absolutely vital that an investor takes account of all of the risks and seeks local advice, where appropriate.

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