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Overseas property driving mortgage demand

Date: Wed, 15 Jun 2005

The increase in purchasing overseas property is helping to boost the demand for mortgages.

It is estimated that three out of four property investors are considering buying a property abroad, in order to take advantage of lower purchase prices and higher rental yields.

Research from The Property Investor and Homebuyer Show North, shows that the growing demand could have a dramatic effect on the high-street mortgage market, forcing banks to offer a wider range of products suitable for overseas buyers.

"Lucrative property portfolios can be started from as little as £30,000 by investing in off plan developments," said Kevin Axon, a property consultant at Emerging Real Estate.

"The risks are slightly higher than in the more emerged markets as the economies, infrastructure and legal framework are not as advanced, but well informed investors can benefit from very high returns on investment."

Traditionally, UK residents have purchased second properties in France and Spain but are increasingly looking at homes in Eastern Europe in order to benefit from lower costs.

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