British lockdown having little effect on expat buy-to-let market

Published:  17 Apr at 6 PM
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In spite of the pandemic, the UK’s buy-to-let market is being perceived as alive and thriving.

According to experts in the British property market, activity as regards the UK’s buy-to-let sector is still going on in spite of the lockdown. The continued interest is believed to have resulted from the introduction of various new mortgage opportunities and their introduction into the mainstream market sector. Basically, the new-style loans are the result of mortgage interest relief changes brought in five years ago by the then chancellor, the which phased out landlords’ tax relief and made it more sensible for expat landlords to operate under a limited company.

As a result, the new laws led to declining popularity for traditional buy-to-let mortgages and a rush by banks to design and introduce new products in order to stay competitive. By January this year, enquiries had reached record numbers and, although activity has slowed as a result of the pandemic, most lenders are convinced buyers are still eager to proceed. According to experts, the majority of interest is from expat buyers in the Middle East, Hong Kong and Singapore, three regions which haven’t as yet been hard hit by the pandemic.

Another positive enticement to invest in UK rental property is the fall in sterling’s value against international currencies, whether in actual cash purchases or mortgage repayments. Although reductions in asking prices aren’t yet being seen, sellers are expected to follow suit by agreeing to discounts on asking prices in order to guarantee sales rather than waiting until the virus’s effect on the market becomes clearer.
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