Whether you’ve decided to take the plunge and move overseas or are looking for a second home abroad, buying property in a foreign country comes with its own set of challenges. Not only must you look at the market conditions and individual property features just as you would at home, but there may also be additional tax and legal issues to consider. This is particularly true if you don’t have legal residence in the country of interest. You can find some fabulous deals on housing abroad, due to differences in currency rates. However, be prepared to spend a bit extra on professional assistance to navigate these legal issues as you get started. The following are a few tips to keep in mind.
Investigate your Market
Buying property abroad is exciting, but you need to know what you’re getting into. Markets can vary by country, city, and neighbourhood, going through independent cycles. You’ll need to keep a close eye on these market fluctuations to make the best investment. For example, if you’re thinking about buying property in Melbourne you’d want to keep a close eye on how real estate Victoria is doing. Are property prices on an upward trend? In addition to house prices, you’ll also need to find out about the rules for foreigners. Some countries limit or prevent real estate investments from foreigners, so take care that you have the right to buy in the first place.
Run the Numbers First
As you learn more about the local market, you’ll also want to take a closer look at your own financial situation. How much can you afford to spend? Remember that in addition to the asking price, you’ll also need to factor in local and national taxes, insurance, lawyer’s fees, and the cost of inspections.
Use an Independent Lawyer
Many development companies or real estate agents specialising in international sales will offer to do all the legal work for you. However, it’s always beneficial to hire your own independent lawyer to represent you. A good lawyer will be able to explain the ins and outs of the contract as well as provide further relevant information. An independent lawyer will be representing only your interest in the transaction, helping you avoid scams.
Get Specialist Advice
In addition to an independent lawyer, there may be other professionals or specialists you will need to turn to for advice. Surveyors, architects, and accountants in the country of interest could all be invaluable as you try to navigate through foreign regulations. An accountant can be extremely important as you set up payment of local and national taxes in a foreign country, and can also help you learn more about factors such as capital gains or inheritance taxes.
Follow the Foreign Currency Market
Even small currency fluctuations can lead to substantial differences in the cost of a property abroad. Be sure to secure your rate of exchange early in the process, or you may find that if the currency rates are less favourable you could end up locked into a contract that you can’t really afford.
Have Documents Professionally Translated
Finally, it goes without saying that you should have all legal documents translated before you sign anything. Hold onto all copies of translations and related paperwork for future use.
Taking the time to ask questions and hire independent professionals to assist you can make short work of buying foreign property, leaving you with more time to relax and plan your move.