Overseas property: a world of opportunity – Conti Mortgages Overseas

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  • 29/06/2015
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Overseas property: a world of opportunity – Conti Mortgages Overseas
The time is now to start considering the overseas property market as a lucrative revenue stream, writes Clare Nessling, director of Conti Mortgages Overseas.

With the pound recently exceeding seven-year highs against the euro, tens of thousands of pounds are being lopped off property prices in the euro zone and buyers, full of fresh optimism, are heading overseas in search of opportunistic bargains.

This, together with historically low mortgage rates and bargain property prices, is creating the perfect storm for overseas property investment. It’s a great time, therefore, to consider the overseas mortgage market as a lucrative new revenue stream.

With buyers’ budgets stretching that much further, a little slice of life overseas could seem even more tempting especially when you compare the cost with overheated parts of the UK market.

According to the most recent figures from Eurostat, the UK had one of the biggest annual rises (10%) in property prices in quarter four of 2014, compared with the previous year. Meanwhile, however, Spain experienced a modest 0.2% increase, France saw a drop of 2%, and prices in Italy were down by 2.9%.

As a result, there are plenty of British buyers who are more willing to explore overseas opportunities in their search for better investment potential. The recent relaxation of pension rules could also lead to more people releasing pent up funds and investing them in a foreign property purchase.

And you may be pleasantly surprised to hear that finance is still available. Quite understandably, overseas lenders have become stricter about whom they lend to over recent years, and they’re now judging each case on its own merits rather than relying on specific criteria. But there’s still a healthy appetite to lend to foreign nationals, especially if buyers have a good deposit to put down.

‘Valuable commission’

Many intermediaries have avoided this market simply because they’ve been unsure about how to tap into it. But numerous brokers have become involved as the result of a single client enquiry, and then been surprised at how easy the process is and become more confident about taking on more.

One such intermediary is Kenny Findlay, an IFA at Independent Medical Financial Management in Livingston, Scotland. In the summer of 2014, he got a call out of the blue from an existing client who wanted to purchase a ski property in France. He wasn’t experienced in this market but didn’t want to turn his loyal client away, so decided to consult the specialists.

“To be honest, I wouldn’t have known where to start,” says Findlay. “So enlisting the help of a specialist broker totally took the pressure off. They took care of all the administration, sourced the best deal and managed the process from start to finish. But I still maintained the direct client contact, so managed to get the best of both worlds.

“There was one small hiccup which involved the completion date having to be moved due to a legal ‘cooling off’ period taking us beyond the original entry date. This was not a problem in the end, but it just goes to show how things work very differently in other countries and how you can’t afford to make any costly mistakes by trying to go it alone.

“The process was a lot easier than I expected and I managed to avoid any potential language barriers. I’m not sure that I could actually have secured the mortgage otherwise,” Findlay adds.

“The overseas mortgage market seemed quite daunting at first, but now I would have no hesitation in accepting any future overseas mortgage requests from clients. In fact, I’ve just received another one, so I’ll be progressing that as soon as possible.

“It also means that I can earn valuable commission while getting on with the day job, and there are no complaints from me there.”

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