Easier for Brits to obtain US mortgages than UK ones, as foreign-national mortgage products boom

Easier for Brits to obtain US mortgages than UK ones, as foreign-national mortgage products boom

  • Increasing numbers of those wanting to climb property ladder looking overseas for mortgages
  • Foreign investors spent $35 billion on US mortgages from March 2013-2014 – a 46% increase year-on-year
  • Brookes & Co launch exciting new Florida project: The Club at Sunset Lake, with US mortgages available

With the introduction of the MMR (Mortgage Market Review) earlier this year and finance seemingly ever harder to obtain in the UK, many individuals are beginning to think creatively about how best to climb the property ladder. Despite fluctuations in the market, a wisely chosen property portfolio is a steady, long-term way for individuals to increase their investment income.

Rental properties in popular holiday destinations around the world are a highly desirable element of any property portfolio, as they allow for receipt of monthly yields at the same time as providing the potential for capital growth. Now, with the UK system tightening up, many investors are looking overseas for just such opportunities in order to make their money work harder for them and the US is one market that is benefiting from this evolution.

Across the pond, foreign-national mortgages is one such product encouraging Brits to invest, with banks offering access to credit for non-residents wishing to invest in holiday homes. Anthony B. Sanders, economics professor at George Mason University in Fairfax, Virginia, explains,

“The American pool of borrowers is drying up. Middle-class borrowers have flatlined due to low income growth, and domestic investors are finding it less appetizing because the foreclosure inventory has dried up. So who do you go to? Foreign investors.”

The banks’ new appeal to foreign investors is certainly working. According to the National Association of Realtors, foreign property investors spent approximately $35 billion on mortgages for US homes during the year to March 2014 – a 46% increase on the previous year’s figure.

Philip Button, Managing Director of specialist property investment firm Brookes & Co, who have been working in the Florida market bringing US properties to UK buyers for over a decade, comments,

“It’s fantastic to see investment in US property through foreign-national mortgages opening the sector up to growing numbers of buyers in the UK. US mortgages are straightforward to obtain and don’t require those applying to travel to the country, thus making international property investment achievable for a greater number of UK residents.”

US banks typically ask for 30% or more as a down payment for foreigners taking out mortgages, while others have set deposit limits, such as HSBC Holdings Plc’s $15,000 minimum requirement. However, with a favourable exchange rate and increasing restrictions on mortgages in the UK, many are finding that it is both easier and more cost effective to take out a mortgage in the US.

Launching on 1st November, the new US investment opportunity by Brookes & Co, The Club at Sunset Lake, times perfectly with this move providing the ideal opportunity for UK buyers looking to capitalise on the growing market.

A brand new gated development in the heart of central Florida, The Club at Sunset Lake is situated close to all major amenities and boasts luxurious facilities including an exclusive clubhouse and swimming pool, fitness centre and spa, sports courts and cycle paths, and a lake front park and picnic area, making the most of the beautiful location in which it is situated.

The two, three and four bedroom properties are spacious, exceptionally built and luxurious with the larger properties also boasting garages. All properties at The Club at Sunset Lake offer a 5-year rental guarantee with a 6% net return after all costs, making this a fantastic investment opportunity.

Two bed properties are priced from £96,950, three bed properties from £118,700 and four bed properties are priced from £137,450, with both residential and buy-to-let US mortgages available.

Philip Button concludes,

“We are very excited about the launch of our brand new Florida project and are sure it will make an excellent investment option for anyone looking to capitalise on Florida’s buoyant market. It will be interesting to see how many of those who invest opt to do so through foreign-national mortgages from US banks. Of course, individuals who do take out foreign-national mortgages have the added advantage of being able to begin building a credit history in the US, which is something that is always advantageous to have too.”

For more information about The Club at Sunset Lake and buying in Florida, contact Brookes & Co on +44 1621 875 925, email info@brookesandco.co.uk or visit www.brookesandco.co.uk