Looking for property overseas?
For many, it is the ultimate dream: setting up home abroad or at least purchasing a property in sunnier climes.
If you have a spare bit of money lying around, then here’s some good news: property prices across much of Europe and in parts of the USA remain affordable when compared to the UK property market.
However, there are several things to consider before taking the plunge of buying a second home abroad. Here’s a selection of the most important:
1. Location, location, location
Many that buy a property abroad will do so in an area they are familiar with already, perhaps a place with plenty of good memories from romantic escapes and family holidays.
But others will simply try their luck based upon the characteristics of the property itself, without first doing their research of the local area.
That can be a disaster, especially where there are communication breakdowns or where the cost of living is high. You must do your homework on where you want to buy your second home before starting your search for that dream property.
2. The small print
Being in a different country brings with it new rules and regulations as far as purchasing a property is concerned.
That includes signing documents – will you need to be present at the time? – and the use of a solicitor. In France, for example, both the buyer and the seller have the same representative, while in Portugal you need to be registered for tax there to buy a second home.
There may be some issues as far as securing a mortgage abroad is concerned. Since the financial crash lenders aren’t always that willing to grant a mortgage in some countries.
You can, of course, apply for a mortgage in your target country, but again you will need to learn the unique rules and ramifications first.
3. Money matters
When you purchase a property in another country, you will need to exchange your pound sterling for the currency in your new ‘home’ country.
That can be an issue, particularly in volatile times, because you won’t know exactly how much money you will have when the exchange rate is taken into account.
If the forex markets move in your favour, that will be the best time to make your transfer. Several firms can help you with this, so be sure to read comprehensive forex broker reviews so that you can entrust your money to them with complete peace of mind.
4. Pension palaver
If you plan on buying a holiday home abroad and continue to reside in the UK, your rights to your pension are unchanged.
But if you intend to later move to foreign soil, the situation regarding your pension pot could change.
If you move to the European Economic Area, or to a country that has a social agreement in place with the UK, then nothing should change. But if you head to Australia or New Zealand, there are likely to be complications.
Will your pension be a significant part of your retirement fund? If so, you might want to consider the ramifications of an international move.
5. Homesick blues
And the final, but arguably most significant thing to consider before buying a second home abroad is how much time are you likely to spend there?
If you are somebody that tends to miss home when you’re abroad, you do have to question the sensibility of purchasing a property overseas.