As the days get a little bit colder and we start to turn up the thermostat, it’s perhaps no surprise that more than a third of Brits are thinking about leaving the UK.
According to the 2024 British Expat Report from Currencies Direct, 39% of Brits are considering relocating overseas. Almost half – 45% – of those keen to leave are in search of a better quality of life, with 39% driven by the high cost of living in the UK, and 37% fed up with the British weather.
Europe is a natural choice for UK expats. The rise in hybrid working has made it much easier for UK residents to live and work abroad. For some, it’s even feasible to live overseas and commute to the UK for work a couple of days a week, with flights taking just a couple of hours.
The diverse and wide range of European cities on offer also makes Europe unique in its appeal to both High-Net-Worth Individuals (HNWIs) and non-HNWIs. On the one hand, it attracts those who may be semi-retired and in search of a quieter pace of life in a Spanish coastal town, to younger, wealthy expats, who might be seeking business opportunities in European cities such as Paris and Stockholm.
With a growing number of potential expats, those who make the move may still want to keep a connection to the UK, and property is a great way to do this.
Whether it’s buying a home for their eventual return to the UK or investing in a buy-to-let or holiday let, as they sample the European lifestyle.
HIGHEST DEMAND AMONG THE YOUNG
If we look at the typical profile of a non-HNW expat, the British Expat Report (BER) shows us that the under-35s are the age group most wanting to move overseas. Among 25 to 34-year-olds, 38% are considering leaving the UK within the next five years, and 11% are thinking of moving right now.
Whether such borrowers earn in a UK or foreign currency – or both – they can use this income to secure an expat mortgage from overseas through a UK broker, much in the same way they would back home.
Expat mortgages are potentially accessible to everyone, from the self-employed to semi-retired older borrowers, as well as those with multiple income streams. Many expats may prefer to rent while working overseas, either due to a short-term work contract, or to get a feel for the area before deciding whether or when to return to the UK.
In terms of job potential, those working in IT, healthcare, and education are the top three professions most likely to consider a move according to the BER, with the highest desire to leave coming from those living in Manchester. About 35% of Mancunians are considering moving abroad in the next five years, and 10% are ready to emigrate now – perhaps it’s the Northern weather!
With its sunny climate, it’s not surprising that Spain tops the list of countries Brits most want to move to, with other European destinations such as Italy, France, Portugal, and Greece also ranking highly.
Beyond the weather, many European destinations also offer a better quality of life in general. Switzerland for example not only benefits from beautiful surroundings but also has a strong economy, low crime rate and excellent healthcare – offering the overall best quality of life for expats, according to the BER.
EUROPE’S APPEAL TO HNWIS
The reasons behind HNWIs’ decisions to move overseas can be quite different.
Knight Frank’s 2024 European Lifestyle Report highlights geopolitical tensions and policy changes for driving HNWIs to relocate overseas. Changes in market conditions, tax incentives, visa options, and lifestyle improvements are also influencing relocation decisions, with a rise in hybrid working and early or semi-retirement among those in their fifties also paying a part.
Henley & Partners estimates that a record 128,000 millionaires will relocate globally this year, surpassing the previous record of 120,000 set in 2023.
When it comes to generational differences in moving, taxation is particularly important for Generation X, Boomers II, and the Post-War generation, especially those nearing retirement. While millennials and Gen Z prioritise employment and education more highly.
Interestingly, factors such as climate, leisure, and visas rank low among all HNW generations.
When it comes to location, over two-thirds (83%) of HNWIs favour city living for its economic and cultural opportunities, with just 17% preferring rural or resort locations. Popular city destinations among HNWIs include Madrid, Paris, Milan, and Stockholm, while Lake Geneva and Monaco lead the way among European resort destinations, according to Knight Frank’s findings.
ENJOYING THE BEST OF BOTH WORLDS
While the reasoning and motivations for a HNW client relocating can differ from those of a non-HNW borrower, expat mortgages can potentially cater to all.
With income from applicants residing in almost any country and earning in almost any currency considered, there’s nothing to stop clients from enjoying a better quality of life in Europe while also benefiting from having a foothold in the UK property market.
With changes in Government both in the UK and forthcoming in the USA, an increased interest is being received from Nationals in both countries looking to move to Western Europe for both a change of job and lifestyle. Popular countries remain France, Italy, Portugal & Spain, but Cyprus & Greece are now also of great interest. However, purchasers need to ensure that they take the correct independent legal, valuation/survey and tax advice before completing the sale and also check that any documentation they sign has been correctly translated by a qualified professional.