Would-be expats looking to move to popular destinations such as Spain and France can find some of the lowest mortgage deals ever available, according to new research.

British buyers in particular can use the strength of the pound against both the Euro and the dollar to their advantage, according to the latest quarterly index from the Overseas Guides Company.

Very few lenders offer mortgages to expats returning to the UK


The index looks at mortgage rates across the most popular expat destinations to establish where the best deals can be found.

Spain remains the most popular destination amongst expats, according to the index. There are good repossession properties still available and mortgage rates on offer from as little as 2.75%.

Angelos Koutsoudes, head of the Overseas Guides Company, pointed out that the International Monetary Fund recently predicted that Spain will lead the rest of the European Union in terms of economic growth over the next year.

‘Team that with these low rates and the Spanish government's on-going commitment to attracting overseas buyers and you will begin to understand why Spain remains such a popular choice,’ he said.

In France, interest is also high and the popularity of the country with expats has been further fuelled by the European Central Bank's (ECB) interest rate drop introduced throughout Europe, which has made it possible to secure a mortgage in France for as little as 1.8%.

Rates on offer in Portugal sit slightly higher at 4.1%, which the index says is a reflection of the nation's desire to safeguard its economy now that things have once again started to move in a positive direction.

‘We have had close to 3,000 enquiries about buying property in Portugal so far in 2014. The Algarve remains a popular choice for expats, especially those looking for a lifestyle change or a buy-to-let investment,’ said Koutsoudes.

Another country benefitting from the ECB low base rate is Italy, where it is possible to secure a rate of 2.9%. ‘There has been a reduction in all of the taxes involved in purchasing Italian property. Other reasons for its growing popularity include its lack of inheritance tax and no Capital Gains Tax after five years,’ explained Koutsoudes.

Buyers can find a mortgage in Turkey for a rate of around 6.4%. Despite recent political conflict, 2014 has been a year of significant growth in Turkey, suggesting that financially savvy overseas property buyers haven't been put off snapping up the readily available bargain properties.

The property market in the United States is in recovery and this looks set to continue with mortgage rates of 3.5% being made available to overseas buyers. In Australia and New Zealand, which consistently attract expat buyers, rates of 4.65% and 5.85% respectively can be secured.

‘Although there are some fantastic rates available in long haul destinations, should you really wish to benefit from these record low mortgage rates, your best bet is to focus your search on Europe,’ added Koutsoudes.

According to Charles Purdy, director of the Smart Currency Exchange, it is important that overseas buyers understand the importance of effectively managing their monthly currency transfers for regular payments such as mortgages.

‘If you've benefitted from these great mortgage rates, the last thing you want to do is end up losing the money that you would have saved yourself as a result of adverse exchange rates or in fees charged by your bank. Look for ways to manage this risk, through using a reliable, regular payments programme and forward purchasing currency when rates are favourable,’ he said.