A question I have been asked a lot is – how can someone abroad buy a property in the UK for residential lettings?
This is why I am writing this post to give you the clear picture of the whole process. This post is an ideal step by step guide for any one who lives outside the UK but wants to buy a property in the UK.
Here is a step by step process:
Step 1# Find a property
Most overseas people buy property in the UK for investment and renting purpose.
Property price and rental demand varies greatly across UK. You should do proper research or consult an experienced property manager before buying a property to rent in the UK.
If you have friends in the UK ask them or you can do your research online.
Process of selecting a property:
- You view the property (Ask someone reliable to view it on your behalf if you can’t do it yourself)
- You make the offer to the agent
- Once your offer accepted by the seller, then you are ready to proceed to arrange finance.
Step 2# Arrange finance
Once your offer on the property is accepted then you can move forward to arrange your finance. To arrange finance, according to my knowledge there are a few ‘must have’ lending requirements mentioned below, but to check up to date criteria feel free to ask me in the comments below:
- Your proof of ID
- Acceptable proof of address
- Last 2 years tax documents (Should confirm minimum £20000 annual income)
- Deposit of 40% of the property value
- Bank account which can accept international direct debits
These are the basic requirements to apply for finance, keeping in mind that the bank could ask for more things before approving your application for finance.
If you have sufficient funds, you can also buy the property without the help of arranging finance. You can also do a remortgage after buying a property and raise funds after 6 months of the purchase.
Step 3# Legal work (Conveyancing)
Main legal work normally starts after you have your funds in place, but you should finalise your solicitor before you start your property search as most of the estate agents will require solicitor details before confirming your offer.
Most of the solicitors offer a ‘no completion no fee’ option. It means getting a solicitor should not cost you anything until you complete your property purchase.
Very Important Point
In property transaction all the money should go through from your solicitor client account. It means you should not pay any money to any third party regarding your property purchase. Except, paying for services such as finance arrangement fee, property valuation fee etc.
Step 4# Rent out & Property Management
You can find lots of letting agents online and you can decide on the basis of:
- How long they are in business
- Check whether they are accredited with any governing body
- Look for what their existing customers say if you can find a testimonials page on their website
- Find out their charges
- Read through their agency agreement
- Whether they provide full services you need
I have written this post solely for the purpose of guidance to overseas investors who are interested in buying UK property for residential lettings. Things change on a regular basis, therefore you should not rely solely on this information to decide. You should consult professionals for the advice before making final decision.
I hope this will help and if you need more information feel free to ask in the comments sections below, I will be more than happy to reply.
Your home may be repossessed if you do not keep up with the mortgage payments
Disclaimer: Consider this post as a guide only. This is not advice and me or my company cannot be held responsible for any decision made on the basis of this information.
Photo credit: Jim Linwood