Buying property should be seen as a long-term investment. Many people are looking at the potential of buying abroad, some to add to their property portfolios, some for a second income and others for retirement.
Whatever your reason for purchasing property abroad, do consider the points below before parting with your money. Depending on where you buy, the potential for a rising income is very promising; property rental is so simple with the internet and sites such as Airbnb, reaching out to millions of potential customers.
But as in all things, before you go signing on the dotted line, there are a couple of things you must think about, to avoid misunderstandings, disappointments and potential problems down the line.
1. Buying on a Holiday
A big no-no! Falling in love with a property while on holiday is not unheard of. In fact, there are real estate companies who have agents targeting people like this..
You are relaxed and stress-free, you are chilling out, but do keep your wits about you. If you are still interested in the concept of owning your own property abroad, when you come home, then do your research. Find out about the country, its rules and property regulations.Talk to people who have bought in these areas. There are forums online where you may find others to get more information.
2. The Foreign Exchange Rates
Foreign exchange rates can be very attractive to the international buyer but remember these can go up as well as down. Explore the recent currency rates, look at the country’s stability. Especially talk to your bank and or the investment manager to explore all the possibilities of what you may encounter.
Will you have to pay taxes on rental monies? Of course,wherever you buy, there will be taxes. It is how and where they are paid that you need to know, at home or in your country of purchase or in some cases both! If you are considering a mortgage for your acquisition, are you sure you will manage, if there is a slump in tourism? These are all questions that you need to ask yourself, to ensure you gain enough information to make an informed choice.
3. Beware of the Extras
Of course, you are aware that there will be maintenance costs, but check how much. It can come as quite a shock. If your property has a pool or gym, gardens, security systems or even a lift – all require care and that costs money.
Maintenance companies range from excellent to absolute nightmares. Again you have to do your homework, check out the various options; from your real estate office to independent contractors. Take the time to investigate what is on offer. Talk to other people who use their services to find if they are competent.
Check if the maintenance company is just a ‘key keeping service’ or do they provide housekeeping services? If you plan to rent, you need to ensure your property is always in excellent condition. Who changes the bedding, washes the laundry? Who cleans the place and ensures it is visitor ready? Who can your visitor contact locally if there is a problem? Bear in mind, you will not want to be contacted at all hours of the day and night to be asked how to turn on/off the air conditioner!
4. Property Laws
Can you legally buy in your country of choice? Some countries have restrictions on who and where foreigners can buy. You may be able to purchase the property but not the land – not a good investment idea. Some countries offer proxies for you to buy through – again not a good idea; however professionally set up, the property will never legally be yours.
Some country’s real estate purchasing systems are very complicated, which will involve hiring a lawyer or their equivalent, in some countries notaries only are used. How do you choose a good one? International lawyers are a good way of ensuring you get through the myriad of red tape with reliability and professionalism, along with thesound advice from experts in the field. Not only speaking your language they will provision you with all the legal assistance you require from translators to documentation according to their legal information FAQ’s.
Buying property abroad can be a sound investment and a dream come true. To ensure the experience is a pleasure and not a nightmare, make sure you know all the facts before making your decision.
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