MORTGAGES
In Turkey,
mortgage terms tend to be
shorter, usually 10 to 15 years
Portugal
“Although the country is struggling with debt, it has managed to avoid the kind of property market collapse experienced by Spain as a result of its tighter lending conditions and stricter planning laws,” says Conti’s Nessling. “Lending is currently more restricted, as lenders have reduced their mortgage portfolios, and fi xed-rate deals are a rarity – but you can still generally borrow up to 75 per cent, and 80 per cent is possible.” She also reports “healthy competition” among mortgage lenders (Conti works with fi ve banks in Portugal). But Miranda John of Savills Private Finance (SPF) warns that international lenders are not lending, and the Portuguese banks in the market are charging high rates for non-resident borrowers. Expect to pay at least 6 per cent. Viva Costa
International suggests a 30-year variable rate deal, currently 6.95 per cent, available on 75 per cent LTV. There’s a 2.24 per cent bank arrangement fee to pay on this.
Turkey
This is a youthful market: mortgages only became available in Turkey in 2007, and availability is generally very good, helped by the fact that the country has been relatively unaffected by the economic crisis. It is possible to borrow up to 80 per cent LTV, though 75 per cent is more widely quoted. Terms tend to be shorter – typically 10-15 years, according to Nessling – and rates start at around 5 per cent.
But overseas property
and fi nance specialist Simon Conn highlights problems with
completion, because the title deed legalities are being rewritten. The new version will not be ratifi ed until at least October. There are also
preferential terms for buyers from the UK, France, Belgium and certain other countries. Conn suggests a 70 per cent LTV euro- denominated mortgage for “good-quality” UK and other buyers, offered at 5 per cent fi xed for the fi rst two years.
Cyprus
Southern Cyprus has been hard hit by the fi nancial crisis. Nessling reports that Conti is not working with any lenders there. “We receive very few inquires about mortgages in Cyprus at the moment, and there is little appetite among banks to lend to foreign nationals buying there,” she says. However, for new-build purchases, developers may offer special fi nance
arrangements with a bank to help shift sales. Conn says that there are still lending schemes, usually 15-year
repayment deals for up to 70 per cent LTV, but you’ll pay 6-8 per cent interest rates because it remains a risky environment, and banks are also trying to recoup their losses. But he cautions that buyers do need to watch out for title issues with the properties they buy, and should also avoid deals offered in any currency other than euros or sterling.
Italy
Local Italian lenders stopped lending to non-residents in the aftermath of the fi nancial crisis, in an effort to limit risk, but brokers are reporting that the mortgage market is beginning to open up again. However, Italian lenders will only lend on higher-value properties, with a minimum loan value of €250,000 (£200,000) on 80 per cent LTV.
“Mortgages are more expensive than in France, with rates of around 4.5-5 per cent. Most deals are variable – we are only seeing two-year fi xed rates at the moment,” says Miranda John.
For up to 80 per cent LTVs, SPF can offer a variable tracker mortgage starting with a two-year fi xed period at around 4.5 per cent, but the minimum loan accepted is €250,000 (£200,000) and it is subject to location.
Greece
Greece’s parlous economic situation means that banks are not currently lending at all.
“However, there are still a few foreign nationals buying on the islands, either using cash or remortgaging their main properties,” says Conn.
“But it’s one to look out for; in due course, as the economy recovers, there will be a lot of good opportunities.”
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