UK Leads Europe

Last week BM Solutions publicised a report on research into the buy to let market in Europe.

The research showed that 79% of landlords in the UK use specialist mortgage products. This is not the case however in Europe. In Germany 94% say there is no such need and 92% of Polish and 80% of Portuguese investors agreed.

70% of UK investors use a broker for mortgage advice but only 26% do in Germany, 23% in Poland and only 6% use a broker in Portugal.

On the continent people open a bank account and stay with that bank for life using in-house advice, therefore eliminating the need for brokers.

British people like owning property but this does not apply anywhere near as much in Europe. Holland is similar to Britain where there has been a good mortgage market for a time. Next door to them in Germany or even Belgium this is not the case though the demand is growing.

The Europeans do not have such a success in property investments with Germany having only 34% of investors making a profit and 30% making a loss. In Portugal 42% make a profit and in Poland 81% make a profit, in the UK 75% of buy to let landlords make a profit.

The difference with Germany is that it is not that important to Germans to own property and they view it as just an investment whereas in the UK it has become almost an obsession to own property.

Unfortunately in Germany lenders operate strict criteria and many deals fall through because of this.

In the UK both professional and amateur buy to let landlords have the chance to get good investments but in many European countries it is far more difficult to get credit unless the borrower is already wealthy. The loan to value is also lower and this means that a larger deposit is necessary.

The UK are alone in having clear views of the buy to let market with good advice and products to hand.

It will be interesting to see if this market increases in Europe or if the UK remain a one off.

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