UK Mortgage Market Expands as More Lenders Open Doors to Gulf Property Buyers

Dozens of UK lenders have started offering mortgages to international buyers, opening up the property market to new investors other than British citizens working overseas, analysis shared with The National has found.

Three in five top-tier lenders now have a route for overseas borrowers, as a growing market develops in which Gulf-based families maintain or acquire UK property using British mortgage finance while keeping their principal residence, businesses and liquidity in the Middle East.

Transaction data includes a private-bank mortgage of about £8.5 million ($11.4 million) on prime London residential property, where income denominated in Qatari riyals was accepted, as well as recent mortgage terms for UAE-resident borrowers earning in dirhams. In another case, a Gulf-resident first time-buyer couple secured an agreement in principle for an 80 per cent loan-to-value UK mortgage.

The analysis by Enness Global suggests the perception that Gulf buyers of London property are predominantly cash purchasers may be wide of the mark, showing a widening group of banks, building societies and specialist lenders willing to finance UK property for borrowers based in the Middle East.

Out of 122 Tier-A lenders in the database, 73 lend to non-UK residents, with 47 explicitly lending to non-resident foreign citizens. Enness Global identified 21 leading UK lenders with specific lending criteria or transaction evidence relating to borrowers based in the UAE, Saudi Arabia, Qatar, Kuwait, Oman or Bahrain.

Islay Robinson, chief executive of the Mayfair-based broker, noted that London and Dubai are increasingly complementary wealth centres rather than just competitors, while the typical 'Dubai buyer' now extends beyond Emiratis to include international entrepreneurs and investors.

Meanwhile, UK house prices rose slightly in August by 0.2 per cent to £275,465, according to Nationwide Building Society, suggesting demand is holding up despite ongoing Middle East conflicts and shifting interest rate expectations.