Here are the key considerations for international investors when investing in Edinburgh property:

  1. Finance
  2. Sourcing
  3. Ownership & tax
  4. Legals
  5. Property Management

Finance – for international investors looking to borrow money to invest in Edinburgh property they will need to secure a mortgage before starting a property search. Recently mortgages for international investors have been hard to come by however some lenders offer products to ex-pat landlords and there are other options for foreign nationals looking to invest in the UK.

Finance – for international investors looking to borrow money to invest in Edinburgh property they will need to secure a mortgage before starting a property search. Recently mortgages for international investors have been hard to come by however some lenders offer products to ex-pat landlords and there are other options for foreign nationals looking to invest in the UK.

Sourcing – If an investor purchases a property ‘off-plan’ they may be comfortable committing to a purchase based on the sales brochures available online or via developer or agent property roadshows which visit many of the main international hubs (we work with Edinburgh developers selling their properties internationally). If investors don’t have access to properties off-plan they will require help sourcing a property. Traditionally property sourcers will charge a fee of 1%+VAT (1.2%) – 2%+VAT (2.4%) of the purchase price.

Ownership & tax – Investors purchasing Edinburgh property will need an accountant to advise on the best ownership structure specific to the investor (normally individually or through a company) and to keep on top of the investor’s UK tax affairs, including updates on any UK tax changes. Taxes due on an investment purchase are Land and Buildings Transactions Tax or BTT (Charged in banded rates) and Additional Dwelling Supplement or ADS (currently 4% of the purchase price). Income tax is due on any rental income received from UK property (less allowable deductions). International landlords can apply to HMRC for a ‘Non Resident Landlord Approval Number’ so that rental income can be paid to the landlord without deduction of tax ‘at source’ (i.e. by the letting agent or tenant). An accountant will also advise investors on other future tax considerations including Capital Gains Tax and inheritance tax.

Legals – Investors will need a local solicitor to act on their behalf to submit offers on any suitable investment properties in Edinburgh. Investors should register with a solicitor at an early stage as identification checks and anti money laundering checks will need to take place prior to submitting offers. A solicitor will charge a fee for their conveyancing services (normally anywhere from £600-£1200) and there will also be charges for Land Registry fees and search fees (Local Authority, Environmental Drainage and Title).

Property Management – Investors should engage with a reputable, regulated local property management company to manage their Edinburgh investment properties. Investors should search on Google to find the local letting and property management agents with the best customer feedback scores (it’s worth checking reviews to make sure there is positive feedback from both landlords and tenants). Investors should check that a local agent is regulated by ARLA Propertymark as these agents operate at professional standards higher than is legally required.

Umega Lettings – We’re here to help international landlords looking to invest in Edinburgh property. We can introduce you to funders or brokers to assist with securing a mortgage. We can also source you a property for a fixed price of £495+VAT (£594). We work closely with accountants who can advise you on the best ownership structure and we’ll set you up with a local solicitor to make offers on your behalf. Once you’ve secured a property our lettings team will take over to secure you a good quality tenant. Our ongoing management fee is 10%+VAT (12%) and a £250+VAT (£300) marketing fee for each new tenant secured.  If furnishing or refurbishment is required, our in-house maintenance team can take care of this on your behalf. So, as you can see we have everything covered to help international landlords looking to invest in Edinburgh property.