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Buying Overseas Property by Hugh Griffin

 

14 TOP TIPS FOR OVERSEAS PROPERTY INVESTMENT:

1. Buy what you want to buy. The most important decision when buying a property is deciding exactly what you want the property to do for you. Is it purely for short term capital gain to provide a one-off profit over a particular period of time? Or is it to provide long term regular income? Or is it mainly for your own use as a holiday home?

2. Ignore the hard sell. Many people go to dedicated overseas property exhibitions or go on overseas trips or "inspection flights" to view properties. It is important to stay focused on what you originally had in mind. Do not be swayed by the hard sell of estate agents.

3. Be careful buying off-plan. Off-plan involves buying a property before it is built. You cannot see exactly what you are buying and it can be a long time before the property and surrounding development is completed. Problems can arise if the building is not constructed according to the original schedule.

4. Allow 10% extra for expenses. The cost of buying a property abroad (taxes, conveyancing, lawyers fees, agents fees, VAT, etc) can be much higher than in your own country. The total can add up to 10% to the cost of buying a property.

5. Buying in an up-and-coming area. This will increase your capital appreciation. Buying in the fashionable areas of Spain or France means that property prices are already expensive and may not increase much further, or increase at a slower pace than in the past. Buying in a less-fashionable area of Spain or France, or in the up-and-coming property markets of Bulgaria, Turkey, and Croatia where prices are still low will increase the chance of a rapid price increase. It is important to note that the less-fashionable and up-and-coming areas still need to have all the virtues of the more established destinations. What you are really looking for is an undiscovered property hotspot. Often such places are neighbouring the more fashionable and expensive areas.

6. Buy a property in a place that is popular with locals as well as tourists. You should always think of the exit route from your investment. The day will come when you want to sell your property and you will want to have the largest possible potential market. Ideally your investment property should be an attractive property for investors of different nationalities as well as a possible home for local residents.

7. Adequate shops, restaurants, and facilities. Most people who want to use a property as a holiday home will want to be near shops, restaurants, and other facilities. This is particularly important if you want a rental income from your investment.

8. Is there an airport nearby? Is there adequate public transport? People who rent property will want somewhere that is easy to get to and will often gravitate to those places with a nearby airport.

9. Consider the property off-season. The property and area might look lovely in summer when all the restaurants and bars are open. But what about winter? Do all the facilities close? Does the area become a "ghost town"?

10. A room with a view. A view is a major bonus from both the rental and the resale perspective. A sea view is top of most peoples list but rural or mountain views can be just as stunning. Nothing beats sitting on a balcony or roof terrace watching the setting sun. Beware though that views can change and your beautiful view could be replaced by a view of a new concrete apartment block. Check local planning regulations carefully!

11. Check the inheritance laws of the country where you are buying. You may need a separate will made in that country as well as a will made in your home country. In France for example your children automatically inherit your house; your estate does not pass to your spouse.

12. Get your own independent advice. Do not rely on a lawyer recommended by the property agent or developer.

13. Learn the language of the country you are buying in. You don't have to become fluent but you should learn as much as you can.

14. Above all, buy a property YOU like in a place YOU like. The chances are that if you love it and would enjoy staying there then others will too!

 

Top Tips for Buying Abroad

1. Never sign a contract that you do not understand (for example - if it is in a foreign language).

2. Always ensure that you seek specialist advice from independent Solicitors, Architects and Surveyors before considering a purchase overseas. They should be proficient in your chosen country's laws and processes and also know the specifics involved in buying a property there.

3. Ensure you do not inherit a debt on the property before you purchase, which a solicitor should be able to check – ie: If the developer has borrowed money to build the development and this amount has been allocated against each plot as additional security to the developer’s bank.

4. Always give yourself a `cooling off` period if you see a `must-have property` and are tempted to put down a deposit there and then.

5. If you are arranging finance on the property, ensure that this is stated in any contract and you have an ‘opt-out clause’ if the loan is not agreed (which will ensure any deposit paid is refunded).

6. Try to arrange your mortgage finance ‘in principle’, before agreeing to purchase the property, or before signing any contracts and paying over a deposit.

7. Arrange your mortgage in the currency that you earn in where possible, unless you are going to receive rental income from that property in the local currency and then this may be a possible alternative option, dependent on the lender’s criteria.

8. Think about combining your cash with friends or family: it could bring a Villa with pool within your financial reach, rather than simply an Apartment.

9. Check with the Estate Agent or vendor that you are aware of the costs charged by the legal and government authorities for purchasing a property in your chosen country.

10. Open a bank account in your chosen country and ensure you get a Certificate of Importation for the money you bring in from your home country.

11. Set up standing orders in a local bank account to meet bills and taxes. Failure to pay your taxes in some countries, such as France, Portugal and Spain, could lead to court action and possible seizure of your property.

12. Remember that bills do not end at the asking price. Lawyer's fees, Taxes, Insurance etc must all be met in your host country and can often be more expensive

Buying Property Abroad.
Tips For Buying In 2006? By: Robert Horwood

Buying a property abroad in 2006

When buying a property abroad many people forget about the most obvious and relevant point of all which is quite simply what do you want the property to do for you? This simple factor could determine the country and the area you buy in to. Are you looking for a short term property investment? Are you looking for a long term regular income? Or like most people are you simply interested in a holiday home for you and the family?

There are two types of property abroad you can buy. Off-plan and resale property. Off-plan means buying a property abroad before it is built. A resale property is simply buying a completed property abroad from a third party. Both options have their advantages and disadvantages. Be careful when buying an off-plan property as you can be sure that the size of the property will finish off smaller than you imagined it to be. It can also be a long time before the property abroad and the over all development is completed. You can also incur problems if the building is not constructed according to the original plans but overall buying an off-plan property abroad can reap some fantastic profits.

When buying a property in Spain allow approximately 10-12% on top of the asking price for additional costs such as lawyer’s fees, taxes and V.A.T. The cost doesn’t always equate to 10% but allow that amount anyway just to be on the safe side. Other locations abroad change accordingly. For example in Dubai there are no taxes which makes Dubai a very attractive investment property opportunity. If you assume 10-12% as being the maximum abroad then you should receive some change every time.

If you are buying a property abroad to emigrate then you must check out the infrastructure i.e. Hospitals, education etc etc.There are some fantastic bargains in the merging markets such as Bulgaria, Romania, Estonia and Cape Verde but it's no good living there if you have to travel out of the country every time you have a health problem or if it's an absolute nightmare to travel around. This is why Spain always ends up being number one in my opinion because the infrastructure is leaps and bounds ahead of many of the eastern block countries. You may pay more to begin with but you receive far more for your money long term.

If you want to buy a property abroad for investment and rental purposes then think about what appeals to the majority.

Is it close to an airport? Is it close to the beach or local amenities? Is there sufficient transport nearby? Are you able to rent the property all year round?

If you are looking for a rental income from your property abroad then spend time finding a good agent. give you advice on this subject. If you can afford to do so then buy a cheap good looking vehicle which could add extra value to the property both on rental and resale. Always try to buy a property that appears to be spacious. The inside colour makes a big difference which is something you can change yourself. Never buy a property that doesn't have a view of some form or another. Either a view of the mountains or the sea. The view can compensate for the lack of space inside.

Always check the surrounding areas for potential building projects as the last thing you want to do is come back 12 months later and find the field next door is a construction site. The chances are your tastes are not that much different to other peoples so although you have to be vigilant at all times don’t forget the basic rule. If you like it then you can be sure that others will also. So buy a property that you like in a country that you like and the rest should fall into place quite nicely.

Thinking of Buying a Property Abroad – What you need to Consider?
by: Allison Thompson

Many people now days are buying a second home abroad, say Dubai as either a holiday location or because they have decided to relocate to that area due to work commitments or because they are retiring and would like to enjoy a bit more sun.

When people are thinking of buying a property abroad there are a number of issues you may need to consider before making that all important purchase and I list below some of them.

1. How much capital do you have available to invest in the new property and if you need to obtain additional capital for the purchase will it be through your current lender or will you be requesting it from another source, say a lender in the country where you are looking to purchase your property. If you wish to lend from a financial institute in the country of your choice you will need to investigate what percentage of borrowing you allow, in some countries you will only provide them with an 80% loan, which means you will need to provide the other 20% capital for your purchase.

2. The type of property you are wishing to purchase? Will it be a town house, an apartment or villa? Also what sort of location are you looking for? Do you want to be in a gated community or a complex, the country, town or village? Also what sort of facilities do you want close to your property, such as shops, restaurants, bars, and sports facilities?

3. Make sure that you contact a reputable real estate agent, one who will be able to provide them with all the necessary information on the property that you are looking to purchase, including all building regulations and planning permissions that should be held. Also this agent should be able to put them in contact with a solicitor/legal advisor who will be able to deal with the drawing up and completion of the contracts of sale.

4. As stated above, where possible request that the real estate agent provides you with the necessary paperwork relating to the buildings legality. In some countries an issue has arisen where people have brought properties and then find that permission for the property to be built has not been given and the consequences in some respects have ended up with these people not only losing their homes but also all the money they have invested in the property.

5. Another thing I would suggest you carry out is research on any local customs or laws for the region you are looking to move to, as in some countries you may find their laws and regulations are not so relaxed as where you reside now, say for instance you decide to purchase a property in Dubai you will find that you are only allowed to drink alcohol within the confines of your own home, in hotels or at a licensed premises any where else and you could find yourself at the mercy of the local police force.

Finally another reason for buying a second property abroad that could influence your decision is the currency exchange rates, for example you may find that the money you have to buy a property at home, say a two bedroom apartment will in fact allow you to purchase a three bedroom apartment in the country where you are looking to purchase.

I hope the above has given you food for thought and helps you when making a decision about purchasing a property abroad.

Author: Allison Thompson, with 15 years experience in the property sector

 

Thinking of Buying a Property Abroad – What you need to Consider?
 by: Allison Thompson

Many people now days are buying a second home abroad, say Dubai as either a holiday location or because they have decided to relocate to that area due to work commitments or because they are retiring and would like to enjoy a bit more sun.

When people are thinking of buying a property abroad there are a number of issues you may need to consider before making that all important purchase and I list below some of them.

1. How much capital do you have available to invest in the new property and if you need to obtain additional capital for the purchase will it be through your current lender or will you be requesting it from another source, say a lender in the country where you are looking to purchase your property. If you wish to lend from a financial institute in the country of your choice you will need to investigate what percentage of borrowing you allow, in some countries you will only provide them with an 80% loan, which means you will need to provide the other 20% capital for your purchase.

2. The type of property you are wishing to purchase? Will it be a town house, an apartment or villa? Also what sort of location are you looking for? Do you want to be in a gated community or a complex, the country, town or village? Also what sort of facilities do you want close to your property, such as shops, restaurants, bars, and sports facilities?

3. Make sure that you contact a reputable real estate agent, one who will be able to provide them with all the necessary information on the property that you are looking to purchase, including all building regulations and planning permissions that should be held. Also this agent should be able to put them in contact with a solicitor/legal advisor who will be able to deal with the drawing up and completion of the contracts of sale.

4. As stated above, where possible request that the real estate agent provides you with the necessary paperwork relating to the buildings legality. In some countries an issue has arisen where people have brought properties and then find that permission for the property to be built has not been given and the consequences in some respects have ended up with these people not only losing their homes but also all the money they have invested in the property.

5. Another thing I would suggest you carry out is research on any local customs or laws for the region you are looking to move to, as in some countries you may find their laws and regulations are not so relaxed as where you reside now, say for instance you decide to purchase a property in Dubai you will find that you are only allowed to drink alcohol within the confines of your own home, in hotels or at a licensed premises any where else and you could find yourself at the mercy of the local police force.

Finally another reason for buying a second property abroad that could influence your decision is the currency exchange rates, for example you may find that the money you have to buy a property at home, say a two bedroom apartment will in fact allow you to purchase a three bedroom apartment in the country where you are looking to purchase.

I hope the above has given you food for thought and helps you when making a decision about purchasing a property abroad.

Author: Allison Thompson, with 15 years experience in the property sector

Buying Property Abroad - Things to Consider!

Make sure that you do not make a decision that you'll regret later. Many people make rushed decisions, not taking enough precautions or not investigating fully other alternatives, disadvantages or pitfalls.

The first thing to ask is what do you want from the property:

  • Holiday home

  • Retirement home
  • Permanent home
  • Rental property

  • Business property (eg bed & breakfast)

Then ask what is the property will offer:

  • Long summer holidays

  • Summer rental only
  • Winter rental only
  • Both summer & winter rental
  • Weekend breaks

  • Specific sporting activities (ie near ski-slope or golf course or beach)

What type of property fits the above and your budget:

  • Apartment

  • House
  • Villa
  • Buying an old property to renovate
  • Building a new property
  • Buying an existing property ready-to-rent-out
  • Buying a property off-plan (ie before it is build by the contractor)
  • Buying a managed development
  • Buying a shared or communal development
  • Buying a timeshare
  • Buying a holiday property bond
  • Part-purchasing (shares in a property)
  • Opting for a leaseback property
  • Number of bedrooms/bathrooms
  • Parking facilities
  • Swimming pool requirement

Other considerations should include:

  • Legal process to purchase property abroad (including language barriers)

  • Fees & costs to make the purchase
  • Letting agent services (and tax implications)
  • Managing agent services (including maintenance costs)
  • Financing options
  • Planning and building regulations if renovating or building new
  • Insurance premiums
  • Visa and permits required

  • Selling considerations, including capital gains tax payable

 

10 Top Tips for Buying Property Abroad

So you’re thinking of buying property abroad, but where do you start? These ten hot tips will help you sort out your thoughts as you weigh your different options.

1. Before you start looking for a property, decide what you want to buy and why. Do you want a small apartment for city breaks, a villa close to a beach for beach holidays, a property to rent out or a property purely for investment purposes?

2. Once you’ve decided what kind of property you want to buy, try not to be swayed by estate agents. They may come up with great ideas of why you need a certain property, but do try and keep your original intentions in mind.

3. Try and buy property in areas that are popular with both tourists and the local market. If you’re going to rent out your property, this will provide more rental scope than purely relying on the tourist trade.

4. Look for areas that are located close to current hotspots. The hotspots themselves can be expensive, but the nearby areas are often more affordable, but can still cash in on the benefits of the hotspot.

5. Always visit the location you want to buy in and the actual property or development site. Although it may be tempting to put a deposit down after seeing a fantastic ad online, you need to check it first to ensure it lives up to the claims.

6. Include buying expenses in your budget from the outset. These differ considerably depending where you’re purchasing your property, but may add as much as 10% to the price you pay.

7. Use reputable real estate agents and always seek independent advice from a qualified solicitor and surveyor.

8. Bear in mind that buying off plan property is usually a considerably cheaper option. Depending on the development stage, you may also get the chance to choose fittings, so it could be a way of getting a more personalised property. Many off plan developers will have a finished pilot unit to show you even before the development is complete.

9. To make your money go further, consider purchasing your property with other family members or friends. Don’t forget to consider in advance how you’ll share the property, or whether it could accommodate everyone at once.

10. If you don’t understand something in the contract, don’t sign until you’ve got clarification. This is especially so when the contract is in a foreign language.