The expat mortgage market is showing signs of life again just six months after the near total withdrawal of the major lenders, experts say.
According to UK-regulated specialist broker Offshoreonline.org, more and more lenders are returning to the sector with competitively-priced deals.
Towards the end of 2008, lenders simply withdrew from the market or only looked at applications on a case-by-cases basis, Offshoreonline managing director Tim Harvey says.
He says by the start of 2009 there were "virtually no lenders in the market" and average deposits needed were around 35% of the purchase price.
However, Harvey says banks and specialist lenders are beginning to dip their toes back into the water and 80% of loans are now available once more.
Interest rates are competitive, with tracker loans available at rates from 2.69% over UK Base rate, giving a headline figure of just 3.19%, he adds.
Investors able to stump up a larger deposit, as much as half of the property's value for example, can benefit from interest rates as low as 2.39% over UK Base Rate. For buyers with a 40% deposit, interest rates could be around 2.59% over UK Base, says Harvey.
He believes buyers looking to budget outgoings will see the return of interest only loans, which are generally available with similar deposit options but an interest rate of 0.2% above that charges for capital and interest repayment loans.
While it may be too early to call the bottom of the market, Harvey says stabilising prices should bring more supply to the market, which together with improved availability of funding for expats, means the summer could present buying opportunities. The Halifax House Price index of 2.6% average price rise in May.
"Conditions are still difficult and lenders are still taking their time picking and choosing the applications they like the look of," says Harvey.
Some lenders are specifying minimum salary levels of £50,000 while most are the setting minimum loan at £100,000, he says.
"Interest rates are once again competitive and we are seeing a definite increase in interest amongst buyers eager to take advantage of sterling's weakness which has effectively made prices even cheaper for many overseas buyers," he adds.
More information on mortgages available can be found at: www.offshoreonline.org
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