So, you are thinking of buying property overseas and naturally find yourself out of your depth. Regardless of which country you choose to buy in, it is a new real estate market that needs careful navigation. Additionally, there is the standard red tape to complete, and having heard some many horror stories; you want to avoid making a disastrous investment.
The good news is thanks to the power of the internet, and many government rules and regulations, safeguarding your investment is easy. When it comes to things like the buying process, people like us, international real estate agents are also on hand for each step from finding a perfect home to visiting the land registry to putting the keys in the door and moving in. However, the time-honoured saying goes forearmed is forewarned, so let’s look at tips and advice for buying the property of your dreams and not a house from hell.
Need to Know When Buying Property Overseas
1: Check Property Budget and Finances
Some home buyers look for properties, find their ideal house, and then try to secure finances. In a rush to get their hands on that home that seems like the perfect place to live and enjoy holidays, they end up overstretching themselves financially. Remember, this is not a cheap purchase to be passed off as an easy mistake to make. It is a significant commitment, and the aim is for it to be a worthy financial portfolio addition. We recommend sitting down to gather a complete picture of your finances, because you should consider four factors.
- Cost of the property, and for mortgages, the monthly borrowing repayments, and interest rates.
- Extra purchasing costs like stamp duty, notary fees, lawyers’ fees. These vary from country to country, so at the most factor in roughly 10% of the property value.
- The yearly upkeep, property taxes, owning and maintenance of the home. If buying an apartment in a complex, most have communal fees, alongside the regular bills like water, electric, and gas. Additionally, from time to time, repairs and decorating are needed.
- Taxation laws when selling or earning a rental income.
2: Reason for Buying and Investing
By knowing your lifestyle requirements and what you want, homebuyers can choose a destination exactly matching expectations. For example, if your primary aim is as a holiday home, investigate the weather, tourism market, and amenities like bars, restaurants, pools, and tourist attractions, likewise, for any foreigner who rents out their house out to holidaymakers to either make an income or recoup living costs. If capital-gains is a focus, look to up and coming destinations offering affordable prices per square meter, and with future 5 to 10-year vision plans for investing in the community.
Any real estate investor looking at a rental property should investigate average rental yields of specific holiday destinations. For example, Altinkum on the Aegean coast, which is known as a budget resort has a lower yield historically, than Kalkan on the Mediterranean, which makes a roaring trade in high-end luxury villas. Please note, when it comes to flipping houses, in-depth local knowledge is essential, and foreigners shouldn’t enter this market unless they are incredibly familiar with it.
3: Overseas Countries to Buy in
Homebuyers who have an exact picture of their financial status can start looking at countries. Some ex-pats already knew which destination to choose, but the latest statistics show the most popular places for buying overseas are Spain, Turkey, Portugal, and France. Each has its own merits, such as Turkey, offering cheap property prices and cost of living. France also includes the specific alpine niche for ski real estate which can not be replicated anywhere else in the world.
More important, than the country is the chosen town, village, or city. No country or property market can be stereotyped into one specific word. For example, Turkey has several different climate zones. Spain’s cultural heritage also differs vastly from the north to the south. Research locally before buying a home or call us to narrow down your choices.
- Find out general information in our country area guides here.
- Read about the top five countries to buy a property.
4: Find a Local Real Estate Agent and Lawyer Abroad
Many foreign buyers choose us to help them buy a house, and one reason is our local knowledge. Our overseas office staff stay up to date with developments, rules, and regulations. For example, how long are foreigners allowed to stay in the country on a tourist permit, the rules re residency, tax implications, taking pets or car overseas, local property investment tips, homeownership, local transport, and how to buy a property.
For investment, they also advise on destinations forecasted for higher capital growth thanks to regional developments and investment into infrastructure. Additionally, although some countries do not require the use of a lawyer, we strongly recommend using one when buying a house and now is an excellent time to find one who acts independently on your behalf.
5: Visit Neighbourhoods and View Properties
Now, is the time to start house-hunting. Some real estate investors never visit the country they buy-in, but if you want to use the house as a holiday home or for permanent living, get on a plane. When you choose us as your real estate agent, we line up properties within your budget and lifestyle requirements. For example, non-drivers want to be near shops, bars, and restaurants or near a frequent transport network. For newcomers to the neighbourhood, our agents give local tours to point out amenities and attractions like the beach, supermarkets, schools, banks etc.
6: Start the Buying Process
Once you have chosen the home to buy, then it is time to hand over to us. Every country has different home buying processes, but generally, it starts with a deposit and contract. Payment plans differ according to whether you buy off-plan, new build, or resale home, but we assist with all that and additional requirements like obtaining tax numbers. It is worth mentioning at this point, to use a foreign exchange company, to get a better currency exchange rate, and save money on transfer fees. Read more about how to compare FX rates here.
Further Reading
European Countries for Retirement: Many of our customers come to us with plans to retire and live a life in Europe. The lure of the sun, food, relaxed lifestyle, and cultural heritage is an ideal place to invest in. this article, we look at the most popular countries for retirement and why people choose to live there.
Overseas Portfolio: Our investment property portfolio of land, commercial units, apartments, and villas in many countries around the world is the perfect springboard to start your search. Each listing contains everything to know, including the price, location, home features, photos, and floorplans if applicable. To receive more information about any home, use the enquiry button to receive it via email or the telephone number to call us.
About Us: We are Spot Blue International Property agents. With our headquarters based in London, we help thousands of people with investment opportunities, to buy homes and invest in other countries. Established in 2003, collectively as a team we have many years of experience and are often featured in major publications like CNBC, the Daily Mail, the Guardian, New York Times, and The Wall Street Journal. Give us a call today to find out more about buying property overseas.
