There are currently no restrictions on foreigners buying property in the UK. This includes both residents and non-residents. Foreigners have the option of an outright cash purchase or applying for a mortgage.
Cash purchases are preferable as they are simpler and do not require meeting any of the requirements of mortgage application. However, if an outright cash purchase is not possible, then you will need to fulfill the following criteria in order to apply for a mortgage and improve your chances of approval:
- You need to have lived in the UK for more than two years.
- You need to be permanently employed in the UK.
- You need to have a bank account in the UK.
The reason for meeting this criteria is to provide the mortgage provider with the ability to assess your credit status. Just like any home buyer in the UK, a credit check is essential to allow the mortgage provider to evaluate the risk they are taking in offering you a mortgage. If you do not have a good credit status in the UK, it is likely that your mortgage will be denied. However, if you meet the above criteria and have a good credit history, then the mortgage should be approved.
If you do not meet the approval criteria, you still have the option to apply for a mortgage but you will need to provide a much larger deposit (down-payment) than normal. This is normally 25% of the purchase price of the property but may be higher depending on the mortgage provider. This is referred to as a non-status mortgage or a self-certification mortgage. It is recommended to come with as much cash in hand to place as a deposit on a mortgage to improve your chances of approval.
If you do receive mortgage approval, generally you will be subjected to the same property taxes as residents. This includes income related property taxes as well as Capital Gains Tax should you decide to sell the property. If you are going to rent out the property, you will be subject to tax on the rental income that you receive in the same way that resident landlords are. However, if you are already paying this type of tax in your home country, then you may be exempt if that country has a double taxation agreement with the UK. You can visit Sell Property Fast Cash for more tips and information about UK properties.
Is Buying Property In The UK A Good Investment?
Due to COVID and Brexit, there is currently much uncertainty regarding the real estate market in the UK. The British Pound may also be slightly weaker at the moment. However, this does not mean that investing in property in the UK is a bad idea.
Historically, the real estate market has recovered from much worse economic situations and you are still looking at an increase in value of your investment. Properties in the UK are also relatively expensive generally speaking which means that leasing the property is likely to be profitable, you can check on this website sellpropertyfastcash.co.uk to learn more. Plus, the UK is one of the only countries that place no restrictions on foreign property purchases.