Here are the basic steps that should be taken in order to buy a property abroad.
- Researching the property market. This step is very important as it enables you to see whether the property market you’re interested in can support and sustain your particular hopes and ambitions. Speak to established estate agencies in your country of choice to find out whether the market is stable or stale. If it’s stable then you’re more likely to enjoy a steady, realistic increase in your property’s value rather than the extreme peaks. If on the other hand the market is stale you need to consider the economy of the country and whether it’s due a positive correction any time soon.
- Travelling costs. Travel costs needed for visiting your second home are very important when it comes to establishing your budget. Keep in mind that any extra visits you might have to make occasionally to organize repairs and renovation. So, it is vital to budget wisely.
- Paying taxes. If you intend to rent out your second home you must declare this income to the tax man in in your home country as well as in the country in which the new house is located depending on the double taxation agreements between the two countries.
- Signing contracts. Be aware of the legalities of any contract you enter into. Find a reputable lawyer and get key documents translated. It is important that you understand all the specifics of the contract. Remember to not sign any documents without expert’s advice.
- Buying through an offshore company. This option is used in order to avoid certain taxes, expenses and laws and is open to an individual interested in purchasing abroad. There are special companies which can advise you based on your individual situation, so before choosing this option it is vital to get informed.
- Options to finance your purchase. Whether you are considering equity release or a second mortgage, cash or mortgage in the local currency. It is very important to know the pros and cons of each option. Speak to a financial adviser of foreign exchange risk expert to find out the best options available.