Everything You Need To Know About Buying Property Abroad

A place in the sun is the dream of many Brits across the country.

The option to jump on a last minute flight and jet off to a second home in the sun, or even leave behind the cold winters and miserable, grey summers of the UK altogether to move to warmer climates more permanently is the goal of many. On the face of it, buying a property abroad looks just like property purchases on home soil, but in actuality, it’s the differences that can cause a few problems. The language barrier, unexpected costs, and sneaky sellers are all potential unwelcome surprises, so it’s essential to be prepared to keep your money and your investment safe. Here’s everything you’ll need to know about buying property abroad.

Create an overview first

First things first, you need to decide why you’re doing this. Do you want to move immediately? Do you want to spend the summer in the UK and winter in the warmer climate? Is it an investment with buy to let in mind, and retirement in the future? Do you plan to timeshare it with another family? The reasons for your purchase will dictate many different elements of your decision making. From the size and cost, to the location and accessibility.

In these situations, lists are the future. A list of needs and wants before you even start looking at specific locations or buildings is essential to finding the perfect property for you. Before you even consider your price range, it’s good to know what is essential for you in a home abroad, and what is desirable but negotiable. What view do you want to be able to wake up to every morning? How hot would you like it to get in midsummer? Do you want a doer-upper? This then allows you to narrow your searches, and helps you to communicate desires effectively to any agents you deal with. This overview is your guidebook to finding your dream home, so the more comprehensive it is, the more effective the search will be.

Don’t choose location on beauty alone

You may have your dream location in mind – a luxurious North Cyprus property, a funky Marbella apartment, or a cute mountain cottage in Spain – but have you considered the implications? If you’re planning on retiring there, what is the local healthcare like, and how easy is to to travel to a major city airport to travel back to visit family, or welcome visitors? If you’re buying to rent, is the area going to be attractive to tourists? What are the local amenities like? Is there a great nightlife, a low-cost airline, and good public transport in the area? Research the area, and try to spend time there in the on and off season. Look at it through the eyes of both someone who lives there, and someone who is visiting for a week-long holiday. Speak to the locals, especially if there are people who have done the same thing as you, and ask about their experience. There is more to the location of a property in the sun than the sun, sea, and sand.

Create a comprehensive budget

You wouldn’t buy a home over here without understanding all the costs involved with the transaction, so don’t fall into that trap abroad either. The difficulty can come when trying to understand hidden costs. Over here we take for granted the associated searches and taxes that come with property transactions, but it’s obviously different depending on the country. Fully research the laws and taxation that comes with property in your country of choice so that nothing comes as a surprise. You will have a good idea of the money you have available, especially if you’ve already spoken to a mortgage provider, but how you will allot that money to the various outgoings is a whole other kettle of fish.

Make sure you understand the current market conditions

The way our money interacts with the UK market is not a good resemblance of the way it interacts with housing markets further afield. Especially while all this Brexit malarky is afoot, caution is very much advised. Property markets tend to cycle, but Cyprus or France will be cycling at a different rate to us, so be sure to research markets thoroughly before committing. This is especially important if your purchase is an investment. When the pound is stronger than another currency which is also gaining strength, buying abroad can be an investment that shows great returns – it’s all about the timing, though.

Never go it alone

With the overseas property game brimming with new experiences and possible problems, you’re going to want legal representation that you can trust. Not just trust them to act in your best interests, however, but trust them to completely understand that transaction at hand. A solicitor who has experience dealing with overseas property investments and purchases will be far better equipped to safeguard you against potential surprise fees and legal issues. Ensure that they confirm that all of the required permissions, deeds, and licenses have been acquired in writing, in case of any problems further down the line.

Use independent solicitors, as you would with any property purchase, but also don’t be afraid to seek advice from independent architects, surveyors, and accountants, who understand the market in your country of choice. These people will help to put your mind at ease that everything is above board, and ensure you don’t run into any unnecessary problems after it’s too late.

Sort out the mortgage as a priority

When you’ve chosen the house of your dreams in the perfect location, don’t sign anything at all without first obtaining your Agreement In Principle from your mortgage provider. If, for whatever reason, your mortgage is refused and you have already made an agreement with the vendor, you could find yourself in a sticky legal situation, with a lot of people complaining of burnt fingers. Remember that the likelihood is that your deposit and mortgage will be payable in the local currency, which means that it is susceptible to changes in exchange rate. This concern is lessened significantly if your property is buy to let, as the rental money will likely be in the local currency and impacted in the same way by the exchange rate.

Don’t overlook the valuation

Just as you would over here, be sure to get an independent valuation before anything is agreed with the vendor. This should check for damp, subsidence, electrical or plumbing problems, and even issues with the neighbours over boundary lines. If you do not get this valuation, any issues become your own, and you are left with no room to negotiate over prices to pay for rectifying problems. It can also flag up issues that you just aren’t willing to deal with, and put an end to the process before it goes too far. A worthwhile cost, for sure.

Research the vendor

If you’re buying a new build or from a larger company, spend some time researching the vendor before making any decisions. Did they work to schedule on previous projects? Were there any complaints about the quality of their work on other builds they’ve funded? In other people’s reviews, have they always acted fairly, dealt with disputes effectively, and ensured good customer service? This will paint a picture of the vendor in your mind, and allow you to decide if you’re happy to work with them going forwards.

Be careful with contracts

Whatever you do, never sign anything you don’t understand! If they provide both an English language and a native language contract, ask your solicitor to confirm the two are identical before you commit – you could be signing your life away and not even know it otherwise. It’s crucial to understand every part of the contract, so be sure to go through it with your solicitor to understand points which you’re unsure on. Your solicitor should be able to ensure that the contract contains everything that is usual in this sort of transaction, including details of the deposit and how it can be refunded, as well as the time frame and any other important aspects of the leasehold or freehold.

Don’t assume everything is the same as at home

Presumably, the main reason you’re buying abroad is because it isn’t the same as what you’re used to, and this will extend to the whole purchase process too. Don’t be surprised by differences in the law, taxation, and purchase process – do your research so you’re more able to take it in your stride. Inheritance tax, capital gains tax, stamp duty, and others will differ from country to country, so don’t let anything sneak up on you. A good lawyer who is proficient in overseas purchases will be able to help you to understand the differences between your new home and your old home, as far as buying and selling goes – they truly are invaluable in this process.

A home in the sun could be your dream future, but tackling the purchasing process before can be stressful and nerve-wracking. Do your research, never agree to anything you don’t understand, and keep trusted individuals nearby, and you’ll be in your dream property in no time.