Upscale London Property Now A Magnet For International Investors

Foreigners and expats are queuing to buy luxury London properties, helped along by innovative mortgage products.

According to a report from an upscale London-based real estate agency, over 50 per cent of the prime properties sold between July and December last year were snapped up by overseas-based buyers. Foreign investors are taking full advantage of the weakened pound sterling, keeping business booming for high-end realtors. In real terms, a luxury home costing one million sterling in 2016 now costs £124,000 less due to currency depreciation.

Mortgage lenders have been quick to respond to the increased demand, offering new deals aimed at overseas-resident foreigners wishing to enter the luxury buy-to-let market, formerly closed to all except British expat investors. Skipton International is now offering overseas investors three to five year tracker loans on amounts up to £300,000 at a rate of 3.24 per cent, but most other lenders are restricting their loans to British expat investors living and working overseas.

One sales and marketing director told the media there are an estimated 5.5 million British expatriates working overseas, with increasing numbers looking to invest in buy-to-let bricks and mortar rather than in more conventional financial products. At the present time, few UK-based lenders are set up to offer buy-to-let loans to non-British investors or even those wishing to buy a property for their personal use but, as the market opens up and sterling continues to fall, the competition for wealthy international buyers is certain to be fierce as products become more available and inclusive.