People looking to own properties outside their home countries have different dreams. Some dream of either acquiring an overseas home for vacations, having a fresh start in life, a house to let out and earn extra cash, or a new home to start over in life. Whatever your dream is, you should know that there are several things you must consider when b buying a home abroad. Whether your dream is casual or for financial gains, you need to be aware of the complexities and realities of this exciting endeavor.
Where can you find properties to buy?
The first place to check for a house is online property portals available in the country you are interested in buying. Renowned property agents that have diversified to different countries are also an avenue to such properties. They include Knight Frank, Savills, Hamptons International, etc. Online property portals and international agents give an insight into the nature of the property market in your choice.
Visiting local real estate agents in the country of choice is also an option for finding suitable and available properties to buy. If you are interested in owning a property in London, consider the letting agents in London and so on. They have a broad knowledge of the history of the market and how it has evolved. They will also advise you on the markets to buy and those to avoid. Although their knowledge base is helpful, it may also be confusing as they are out to sell their property portfolios. Hooking up with residents is gives a more detailed property insight as they are not biased.
When buying a home abroad, creating time to visit developers based in the country of choice is essential in visit some if not all the properties available for sale. The property portfolio entails newly built houses or off-plan properties. Before settling on a developer to transact with, you must check their credibility. Their reputation indicates it among the residents of the given area.
What are the legal requirements of owning a property abroad?
Like owning property in your home country where there are multiple legal obligations, properties abroad also have legalities involved. You are familiar with the property laws of your home country, but they are different from the neighboring jurisdiction. A detailed insight from a financial advisor about all the legal requirements you must fulfill with owning property abroad will save you from actions with the law. Laws that touch on buying a home abroad include:
- Licenses and notaries
While some jurisdictions require you to obtain a license to own or rent a property, others require a notary. Both are essential in restricting or stipulating the extent of land you can hold in the subject country. Also, take up all the necessary guidelines to ensure your purchase is legal. They include involving an independent lawyer with an in-depth knowledge of the property market of the subject market. Ensure that they have no connection with the agent or developer you are involved in the purchase. He or she must be fluent in the local language and your language as well. It will make more sense if you hire a lawyer based in the country you are interested in purchasing.
- Tax charged on overseas property
Tax obligations in your country are different from the country you are interested in owning a property. Legal advice is mandatory in understanding the taxes you are required to pay whether you are renting or purchasing a property outside your jurisdiction. For rental properties, you must pay tax on the net rental income collected. When you sell property other than your primary residence, capital gains tax applies. However, checking for double taxation treaties will save you from paying taxes to your home country and the country you have bought your home.
What are the costs involved in owning property abroad?
- Ongoing costs.
Even after signing the sale agreement with the developer or the local real estate agent, there are additional costs that you must pay regularly. These include maintenance costs, insurance premiums, and utility bills for those who own a rental property or agent fees, repairs and maintenance, and insurance costs if you have purchased a property. While drawing your budget, you must include all these costs to avoid struggles after signing the contract.
- Fees involved in converting cash
To foot the regular bills and rent, you must convert your cash to foreign currency. If you are not receiving your payment or pension in the currency of that foreign nation, you are suited. If you are not, you may consider buying the currency or using a debit or credit card that does not charge fees on overseas payments.
Cost of living, laws on foreign ownership, choice of financing, and tax obligations are the factors that are key in killing or making your dream of foreign property ownership. Take time to get a detailed understanding of all these factors when buying a home abroad.
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