One in four first time buyers looking to buy overseas

One in four first-time buyers in the UK are considering purchasing property overseas, and nearly three quarters (70%) are abandoning plans to buy UK property due to inflated prices, according to new research from Moneycorp.

The currency specialist's third biennial report reveals that more than a third (34%) of first-time buyers have been put off buying in the UK by the volatile housing market. The number of investments in UK properties remains low and sales are unlikely to pick up in the near future unless house prices drop.

As a result, would-be buyers are looking elsewhere, with the housing market abroad being considered as a safer bet for returns on investment. Around a quarter (24%) of respondents said they would consider buying a property overseas, with 86% expecting to get more for their money there.

The research reveals that the top choice outside the UK for first-time buyers who do not plan to relocate is France, followed by Spain. Australia is the most popular choice for people who do want to move abroad.

Moneycorp says that despite turbulent economic times, one of the reasons why many first-time buyers are considering investing in overseas property is the high costs of UK housing, which has recovered over 12 per cent since the lows seen in 2008. This has made it far harder to get onto the UK property ladder.

Conti, the overseas mortgage specialist, has also seen cases of first-time buyers opting to purchase property abroad after finding themselves priced out of UK the market.

Clare Nessling, Conti's operations director, says, "Overseas mortgage providers have a healthy appetite for lending to foreign investors, but it's not just mortgage availability that's leading to first-time buyers seeking opportunities abroad. Bargain property prices, historically low interest rates, and the fact that the pound's value is improving against major currencies, are all making it much more affordable for them."