The basics of acquiring banking property in the UK

The concept of ‘banking property’ includes all the property that was confiscated, arrested or bailed. Bank property in London forms a self-sufficient segment, which is intermediate between the secondary and primary housing market (new buildings). The investors who know what’s what in this practice, take the opportunity to invest in this type of facilities and oftentimes succeed due to beneficial terms of deals. The city of London is chosen due to its economic stability and rapid development (the city generates around 24% of the national GDP), which is characterised by constant price growth in the cost of housing and high demand for residential premises. All this serves as a guarantee for almost risk-free, profitable purchases.

By the present moment the British banks are among the largest owners of real estate, who are ready to provide the investors with a variety of proposals. Virtually all the major banks in London work with real estate companies, whose task is the sale of all the objects in the possession of the banks. Importantly, bank offers are sold at a price lower than the average market rates.

To clarify the prospects of the potential profitability of the affair, having a comprehensive understanding of the advantages and disadvantages of a potential deal is absolutely essential. Thus, confiscated, seized or planted banking property in many cases could represent a promising deal in relation to the purchase of new or resale property. The main advantage of this segment is costs – the purchase of real estate from bank is mostly a prerogative of investors who are limited in the size of their own capital allocated for investment. In practice, implementing the sale of bank property, is below the average pricing level by 30-40% on average. However, the price difference in some cases can reach up to 80%. Factors that affect such a large fall in prices will be announced later.

Another advantage that awaits investors seeking to buy property in the UK bank is financing. The funding comes from the banks, who control the object. London banks are interested in attracting customers not only for real estate at affordable price, but also for associated with property investment project. First of all, it is an opportunity to implement a property that is listed on the bank’s balance sheet. Secondly, the ability to provide mortgage to customers who purchase the object. And thirdly, providing loans at low interest rates to eliminate the risk of non-payment of a mortgage loan. The main recommendation when choosing a bank is to review the bank’s portfolio and real estate conditions as for mortgage lending. These conditions will be largely impacted by the area where the object is located and its total cost. As a rule, the maximum amount of a mortgage for non-residents of the United Kingdom reaches 70%. The client will incur costs that accompany the procedure of registration of the transaction for the sale, as well as cover the associated legal expenses; mainly the services of conveyance solicitors.