The property buying process abroad isn’t the same as in the UK. The property markets vary from country to country and their different processes and taxes can become quite complicated and expensive. With this in mind, here are five top tips to help you buy your new home overseas.
Consult a property lawyer
Once you’ve decided upon location, it’s essential to enlist the help of a qualified property lawyer who understands how the property law in your host country relates to non-residents. Your legal adviser will be able to oversee the whole process and can you advise you on how the procedure works. They’ll also be able translate documents and assist with negotiations in the host country’s language and can look over the contract before you sign any documents.
Of course, the advice and guidance of a lawyer isn’t going to come cheaply therefore it’s wise to ask for quotes from a couple of companies before settling for the first one. Some lawyers will state a price upfront whereas others may ask their fee to be a percentage of the value of the property. Whatever is decided, make sure you’re happy with the price and the reputation of the company.
When looking into the property buying process abroad you can either borrow from the UK bank or take out an overseas mortgage. The majority of the UK banks that will grant you a mortgage tend to have branches abroad. For example, Banco Halifax is the Spanish Halifax branch and Barclays have divisions in the EU as well as Dubai and South Africa.
If you’d prefer to take out a mortgage abroad, it’s important to go through a specialist broker who is an expert at non-residential loans. They will be able to explain the process and will be able to tell you how much mortgage fees will be. In France and Portugal they can be about 10% of the purchase price, so it’s essential to research and enquire before you go.
The property buying process abroad can sometimes involve an unprecedented amount of taxes and unexpected costs. Before you sign anything, make sure you understanding what additional costs you will incur. Consult with your property lawyer and estate agent on property taxes and whether you will need to pay taxes of occupancy, stamp duty, capital gains, the equivalent of council tax and service charge taxes for those living in a block of apartments.
Be aware of currency fluctuations
Although there are major benefits for paying for your house in cash, it’s not always possible for this to happen. With this in mind, it’s important to be aware of currency fluctuations when transferring money for large transactions. Be aware that exchange rates can alter dramatically from the time you agree to buy to the time you actually pay for your property.
Remember – You can rent before you buy
It’s easy to get caught up with the excitement of relocating but don’t forget that you can rent before you buy. This time will allow you to settle and to establish your surroundings and to find the right town or village that you want to spend some quality time in. If you have a family, it’s important you find the right school with a variety of nearby activities such as a park or sports centre for after school entertainment. This period will also give you breathing space to research into the country’s respected property lawyers, mortgage brokers and estate agents so you know that when it comes to buying a property, you are in good hands.
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