Housing & Accommodation
Buying a House in the UK
- Unless you are buying a property as an investment, weigh up the advantages and costs of owning a property versus the length of time you will be living in the UK — is it worth it?
- After a rocky few years and plummeting prices, the housing market in the UK is once again on the rise but keep an eye on it — you don’t want to lose money on your property.
- When you’re budgeting for your new home, make sure to take all of the extra costs into account.
- While you should have a thorough look around a property to ensure that there is no obvious damage, it is also advised to have it surveyed by a professional.
If you are planning on buying a house in the UK – or an apartment, for that matter – instead of renting your expat accommodation, there are some things to consider first.
Pros and Cons: Do You Have the Time?
If you are in the UK for a comparatively short time (e.g. up to two years), it is probably not worth the hassle. Buying a house in the UK takes about three months, from viewing property ads to sealing the deal. So you would spend the first couple of months on buying a house in the UK, and the last few months of your time as an expat trying to get rid of it without incurring a loss.
But what if you’d like to purchase a home for your expat life in the UK and then keep it as an investment later on?
Property as an Investment: Ask the Experts
If you consider buying a house in the UK to use it as a capital investment, you should talk to a reliable expert who knows the real estate market really well. While there are no restrictions whatsoever on foreign ownership, you want to make sure that such an investment actually pays off.
After a rocky few years where the house market is concerned, house prices in the UK are once again on the rise, having risen 8.4% between 2015 and 2016. If you are planning on selling your property once you leave, keep a close eye on the market trends to ensure that you don’t end up losing money. If you are planning to let your property, be aware that rental yields in the UK are among the lowest in Europe (an estimated 4.2% of the property’s worth). However, buying a house in the UK as an investment depends a lot on the real estate market in different regions or individual cities.
The Bubble is Finally Bursting: The UK Housing Market
Housing prices in Northern Ireland, Scotland, and some parts of northern England are rising, with the average price of a home standing at 284,000 GBP in 2016. In the south of England, though, real estate prices keep on rising at a greater rate, with the average price being 368,000 GBP. Unless the market develops a property bubble, buying a house in the English southwest, along the south coast, or in the southeast is going to be a sound investment.
The Thames Valley and the natural beauty of the Cotwolds are (in)famous for their local property prices, especially on refurbished cottages and picturesque holiday homes. Even the rural quiet of East Anglia is marked by rising costs for buying a house in the UK. But it’s the Greater London Area that constitutes a real estate world of its own – especially in Central London.
The Costly Capital: Real Estate in London
The general cost of living in the UK capital is high. Thus it does not come as a surprise that both property costs and annual rents in London are way above the national average. The Brexit vote, however, has worked in favor of property prices in London. In July 2016, the price of an average property in London fell by 30,000 GBP.
Prime real estate areas of inner London, such as Chelsea, Kensington, Knightsbridge, Mayfair, or Westminster are the prerogative of the very wealthy. Still, foreign ownership is quite high in these boroughs. Top-tier executives, overseas diplomats, or international businesspeople working in the City might be able to afford a luxurious London townhouse for a million pounds – or far more, in some cases.
Tiring and Time-Consuming
If you are planning on buying a house in the UK’s unrivaled center, you should plan on spending even more time on your property search. But no matter where your new home is going to be, in London or any other city, you should be prepared to do some legwork yourself. If you still live overseas, you need local support that you can absolutely rely on.
This is another reason why it makes sense to only buy a house for a long-term stay in the UK. If you have already lived in the area where you’d like to settle, you’ll know which neighborhoods you prefer, and you can easily view various properties for yourself. But even if you are able to go house hunting on your own, you should not go through the actual purchase process without professional help. Buying a house in the UK has its practical and legal pitfalls, and you should hire a lawyer (solicitor) to back you up.
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