With the stamp duty hikes on second home purchases and buy to let properties in place and the Prudential Regulation Authority’s (PRA) changes to buy to let stress testing coming in this year, buy to let investors are proceeding with more caution when buying property than before. For expat buy to let investors this seems a shame, as the favourable foreign exchange (FX) rates the weak Great British Pound (GBP) has created an environment in which property priced in GBP is cheaper for those using certain foreign currencies than it would otherwise be.
Buying a buy to let property in one’s own name is certainly more difficult than it used to be, tax advantages are being diminished for buy to let investors and the new rules are targeted at buy to let investors.
Yet the new rules should not be prohibitive for those expats interested in the buy to let market. Indeed, at Enness, regardless of these changes we have seen a lot of interest from expat buy to let investors, particularly those looking to nurture their retirement pots.
Due to our extensive network of lenders, we have managed to source a product that caters for your expat BTL needs, is tax efficient and has exceptionally competitive rates.
The 5-year fixed rate expat buy to let investors mortgage allows expats to purchase investment properties through a company structure, such as a special purpose vehicle (SPV) or limited liability company (LLC).
Instead of paying the usual tax-rates you would be subject to buying the buy to let property in your own name, the company structure allows expat buy to let investors to pay UK tax on their properties at business rates, 25% lower than the top income tax-bracket in the UK. Furthermore, the rental stress test is 125%, 20% lower than the usual market rate of 145% representing an excellent investment opportunity for prospective and proven BTL expat investors alike.
The product is as follows
- 5-year fixed term
- 125% rental stress test
- 75% loan to value (LTV)
- Maximum 15-year interest only term
Further, Enness clients will receive a preferential FX service due to our partnership with the foreign exchange broker, Argentex. Backed by the Pacific Investment Group, Argentex have an £80billion fund which means they are able to offer rates around 3% lower than the market standard, an exciting proposition for those with income in foreign currencies.
For those looking to retain property interests within the UK and not be held back by the latest changes to the buy to let market this product offers a great opportunity. If you have any queries about the product raised, then please do not hesitate to get in touch.
*All tax matters should be subject to individual tax advice.