An increased interest in overseas markets is fuelling the Buying Abroad Renting in Britain (BARBies) trend.
Three quarters of first time buyers (FTBs) are abandoning their plans to buy property in the UK due to market instability, with nearly half putting their hopes in property abroad.
Moneycorp’s First Time Buyers Report, which examines the FTB market every two years, also reveals that a third have been refused a mortgage in the last six months.
This statistic backs recent figures released by the Council of Mortgage Lenders, highlighting that the number of mortgage loans to FTBs fell to 17,800 in March, down almost 50 percent from August last year.
As lending criteria tightens and 100 percent and 95 percent mortgages disappear from the market, UK first timers are turning to foreign shores where more than four in five think their money will go further.
Spain continues to be the number one choice for FTBs setting their sights overseas, with France in second place. The USA has pushed into a top-five position, with cash savvy Brits looking to take advantage of the weak Dollar.
Australia is in fourth place in 2008 – despite not making an appearance in the top five back in 2006 – and Italy is down from third place in 2006 to fifth place this year.
“The fact that so many buyers are prepared to get their first taste of home ownership in a foreign land speaks volumes for the state of today’s domestic market conditions,” said Moneycorp spokesperson, Marc Morley-Freer.
“Our research also shows that two in five (41 percent) FTBs aren’t aware that favourable exchange rates can save them a lot of money when transferring funds abroad – for deposits or mortgage payments.
Companies like Moneycorp make it easier – and of course cheaper – to buy overseas, as we’re able to provide better exchange rates than a bank. With more currency, first time buyers have a greater choice when it comes to purchasing their property overseas.”
