Prime Central London is an area which often comes high on the list when our UK and overseas clients are looking to invest in real estate. Despite recent sluggishness in the market, investors understand the enduring appeal of areas such as Mayfair, Marylebone, Kensington and Knightsbridge, and appreciate the opportunities for long term investment.
The main issue with buy to let mortgages in prime central London can be rental yield, which – although stable – is usually lower than other areas of the city.[i] This can affect how much you can borrow against the property, an issue which our client recently came up against whilst looking to raise £1.85m against a property valued at £3.2m. As the rental yield was not deemed enough to cover repayments, the lender had to be persuaded to take the client’s personal income into account.
Our Senior Partner, Nigel Bedford, identified a lender which uses a bespoke buy to let affordability model, allowing both rental and earned income to be taken into account to ensure that a mortgage of this level could be agreed, and our clients could use the capital raised to buy a home on the continent.
If you’re looking to secure a buy to let mortgage and think you could benefit from the help of a specialist team of advisers, don’t hesitate to get in touch.
Your home or property may be repossessed if you do not keep up repayments on your mortgage.
Property prices can fluctuate down as well as up. You should ensure that you have alternative arrangements should your property value fall below the borrowing amount outstanding.
This information does not constitute financial, legal or accounting advice. Investors should seek their own independent advice before proceeding.