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How To Buy A House In The UK As A Non-Resident Or Foreigner?

Property Saviour » Buying » How To Buy A House In The UK As A Non-Resident Or Foreigner?

The UK is an attractive destination for immigrants and expats, and for good reason. It offers an excellent quality of life, an outstanding education system, a strong economy, a multitude of job opportunities, and a rich diversity.

If you are living in the UK but are not a citizen or are not planning to become one, you may think that buying a house in the UK as a foreigner is a complicated process.

However, this is not the case. Buying a house in the UK means getting great mortgage rates and low monthly payments, as well as making a real investment in the country.

Can a foreigner buy a house in the UK? If so, what is the process? This guide will help explain the steps you need to take to make it happen.

Table of Contents

Buying a House in the UK as a Foreigner – The Simple Steps

A foreigner can purchase a house in England. The process isn’t as complex as you’d think. There are no legal restrictions on expats or foreigners buying property in the UK.

However, if you have less than two years of residency and don’t have employment, getting a mortgage loan to buy the property might be more difficult.

It’s important to understand the terms you’ll see in your initial property search. A converted building is a structure that was renovated to become flats instead of its original form. A studio is a single-room flat except for a bathroom.

A maisonette is a house split into two flats, each with a private entrance. A terraced property is attached to other houses, also known as row homes or duplexes. An end-of-terrace property stands on the end of the row, while a semi-detached is attached to a house on one side, but not the other.

A detached home is a property that doesn’t share a wall with another single property. There are leasehold and freehold properties, which respectively give you the right to live on the property for a certain number of years or to buy the property and the land it’s built on.

  • Finding a property you love is the first step in the process. Consider the property size, the number of bedrooms and bathrooms, and other spaces like a kitchen or home office. Think about how much outdoor space you want and the area you’d like to live in.
  • Then, search for properties and contact an estate agent to arrange a viewing if you find one you like. Make an offer verbally or in writing. You may offer less than the asking price, as properties in the UK often sell for less than the asking price.
  • After making an offer, hire a conveyancing solicitor to handle the legal paperwork. This usually costs between £500-1,500 plus VAT.
  • Arrange financing for the property next. Every lender in the UK has their own set of rules for lending to non-residents, including your visa status, income level, and amount you can borrow.
  • Hiring a mortgage broker could help you identify lenders and find the best rates. Finally, get a survey of the property to identify any issues.
  • Exchange contracts and set a date of completion once you finalise your offer. On the day of completion, the mortgage provider will transfer money to the seller’s solicitor’s account and you’ll get the keys to your new home.

How to Buy a House in London as a Foreigner (or Anywhere in the UK) – The Fees You’ll Pay

Now that you’re familiar with the process of buying a home in the UK, it’s helpful to understand the fees typically associated with this.

A major cost will be Stamp Duty. This can be confusing as Gov.UK defines a first-time buyer as someone who has never owned a residential property in the UK or anywhere else in the world and plans to use the property as their main residence.

So, if you own part of a property elsewhere, even if it was inherited, you won’t be considered a first-time buyer and will have to pay Stamp Duty. You can use online Stamp Duty calculators to get an idea of what this might cost.

Also, if you’re a non-UK resident, you may have to pay an additional surcharge. It’s important to be aware of this as you’ll have to sign a legal document about your property history and Stamp Duty liability with your conveyancing solicitor.

When it comes to mortgages, you’ll need to pay a deposit, usually up to 40% of the property price, as well as arrangement, booking and valuation fees.

You’ll also have to pay your conveyancing solicitor for their service, as well as for other expenses like settlement and searches. The Land Registry fee will also apply, to have the property’s legal deed transferred to you, which your conveyancing solicitor can take care of.

Finally, you may incur fees in your home country. For example, as an American living abroad, you may be liable for capital gains taxes in the US, even if you’re claiming tax residency in the UK and paying income tax to the HMRC. You’ll need to check with your home country for more information.

How To Buy A House In The UK As A Non-Resident Or Foreigner
There are no legal restrictions on expats or foreigners buying property in the UK.

Making Your New House Feel Like Home

Once you’ve got the keys to your new home, there are just a few more things to do. Firstly, you’ll want to make sure you have the right insurance. In the UK, there are two types of coverage: buildings insurance and contents insurance.

Buildings insurance covers the actual structure of the house, as well as any fixtures that are fixed. Contents insurance covers the items inside, like furniture, cookware, electronics and jewellery. You can get separate policies or a combined one.

You’ll also want to ensure you have enough building insurance to cover the cost of rebuilding the house if there’s a fire, flood or vandalism.

When it comes to contents insurance, you can get either an indemnity policy, which pays out the item’s value minus wear and tear, or a new-for-old policy, which pays out the cost of a new item. You can also get optional extras.

Next up is getting the utilities set up. For electricity and gas, you have the choice of several suppliers. You can opt for a fixed or variable rate. Start by contacting National Grid to arrange the connection. The average cost of electricity is 20p per day.

For gas, you can sometimes bundle it with your electricity. Water is usually supplied by the local water company and you just need to set up an account.

There are lots of internet providers and packages to choose from. Make sure you pick the right download speed and you may even be able to bundle it with a TV subscription and landline.

TV services are slightly different in the UK, so you’ll need to check which providers are available in your area.

The Bottom Line – Can a Foreigner Buy a House in London or Other UK Cities?

If you don’t come from the UK, you can buy a house anywhere in the country. It is important to know how the process works and how your lending options may differ from those of UK citizens.

This will help you to find the best providers for your house-buying journey. Make sure to look for those who can assist non-citizens in finding the perfect home and the ideal home loan to get exactly what you need!

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