Yes, as a foreigner, you are eligible to purchase property in the UK, regardless of whether you are a resident or not.
If, however, you would like a longer answer – or just decided to ignore the first line of this article -and are still asking yourself, ‘Can foreigners buy property in the UK?’, here’s a detailed guide outlining the process.
How Much Does It Cost to Buy Property in the UK?
If you don’t have the cash at hand to buy a UK property outright, you could consider going down the route of a mortgage.
A buy-to-let (one of the most popular property investment strategies) mortgage deposit is usually around 25% – with a buyer also needing to cover stamp duty land tax, legal fees, and land registry fees.
Say, for example, you’re looking at a UK property worth £100,000 – most likely the lowest price you can find – as an overseas buyer, you can expect to pay an estimated cost of around £31,200 upfront.
This is without also factoring in other potential expenses – like a survey of the property and mortgage lenders charging a higher deposit for overseas buyers.
As a property investor, you’ll also need to factor in the running costs of owning and maintaining a rental property.
This includes things like:
- Mortgage payments
- Income tax
- Ground rent
- Property management fees
- Maintenance costs
- Landlord insurance
Can Foreign Buyers Purchase Property in the UK Without a Visa?
Once again, to put it simply:
Yes, non-UK residents can buy property in the UK without a visa.
However, if you want to invest £2 million or more, you must apply for a Tier 1 (Investor) visa.
To be eligible for this, you must:
- be 18 or over,
- have an account open with a UK-regulated bank,
- be able to prove the money belongs to you or, failing that, your partner.
The visa allows you to stay for a minimum of three years and four months – which can be extended if needed and allows your dependants to also come on the same visa.
The UK property market and property prices
Despite the cost, investors still stand to earn significant capital growth in the UK – mainly due to the massive property price growth expected in 2022.
In December 2021, the UK experienced a record-breaking year that saw house prices rise to £254,822 on average.
In fact, prices grew so much last year– and so quickly – that it was also recorded as being the highest overall growth in 15 years.
And, when factoring in further growth predictions, it’s clear that this trend is seemingly only going to continue.
Experts predict that prices could climb as high as 18.8% in the North West and Yorkshire and The Humber by 2026, with a 4.5% rise in 2022 alone.
And alongside this thriving property market, the UK rental market is also seeing tremendous growth.
The average UK rent reached around £1,060 in December last year – just under £1 below the previous record set three months prior.
Of course, this has led to rather notable rental yields, with cities like Liverpool generating returns of over 10% in certain postcodes.
Even more impressive is that these yields are far higher than other countries in the world. Even the most popular spots like Shanghai only generate an average rental profit of just 2-4%.
With so many opportunities like these to make high rental returns, it’s no shock that buying property in the UK (particularly as a non-resident) is an increasingly attractive venture.
In the wake of the Covid-19 pandemic, many people are also reconsidering what they want from a home, and even more are choosing to rent a property over purchasing outright for themselves.
With this increased tenant demand and already high rental yield figures, the future of the UK rental market almost definitely looks brighter than ever for both local and foreign investment in the UK property market and focusing on high yielding areas like Liverpool is one of the best property investment tips to consider.
So, there you have it.
Yes, to beat a dead horse even further, foreigners can buy property in the UK.
And, with the current strong market and consistent price growth, now more than ever seems like the perfect time to get involved.
However, it’s even more important to remember that research is everything.
Take the time to study the market, investigate your options thoroughly, and consult with experts before taking the plunge.