Buying property overseas: a quick guide
This quick guide to buying property overseas outlines the fundamental elements of the process from country to country - so you can begin formulating a proactive plan whatever your chosen destination.
As with any major investment, purchasing a property overseas takes a lot of planning – but there’s no prescribed approach. While the buying process varies depending on your destination of choice, presenting different challenges, there are fundamental similarities from country to country.
Whether it’s a villa in Spain or a farmhouse in France, most people have concerns about sending large sums of money to another country with an unfamiliar legal system, language and currency. To help you make informed decisions and save money, time and stress, I’ve created this quick overview of the common elements of the overseas buying process.
Location, Location, Location
To help you pinpoint your ideal location, consider the reason for your purchase – holiday home, retirement, relocation, buy to let or pure investment – because different locations will tick different boxes.
· Holiday home: Choose somewhere with convenient access to an airport and make sure the property is easy to maintain and lock up and go.
· Retirement: You might want an expat community on your doorstep and all the amenities and social opportunities that come with it.
· Relocation: Check out nearby schools and employment opportunities. Consider whether you’d like to be near fellow Brits.
· Buy to holiday let: Choose an area with good airport access, tourist attractions and beaches. Research any local buy to let restrictions.
· Pure investment: Research the local property market and check current and future demand.
Search for your property
Once you’ve decided on where to buy, it’s time to begin the search for your ideal property. Online portals are a great place to start browsing. To help narrow down your selection, think about what type of property you’d like to own. This decision will probably depend on why you’re buying.
· Size: How many bedrooms and bathrooms do you need?
· Off-plan or resale: Can you wait for construction to finish?
· Fully refurbished or a fixer-upper: How much work are you prepared to have done?
· Own garden/pool or shared: Do you want responsibility for maintenance?
Now you know where and what property, you need to calculate a budget that factors in buying costs before you start looking.
Top tip: Don’t forget to consider exchange rates when setting your budget – if left unaccounted for they have the potential to increase the cost of buying overseas.
Contact estate agents
Once you’ve found a property (or properties) that tick all the boxes, contact a local estate agent.
Top tips for choosing a reliable estate agent:
· Choose an agent that’s registered with a regulatory body in the country you’re buying in.
· Choose an agency with a real office with a real address.
· Choose an agent who has been around for a few years (say five) so you can be sure they’ve established a good reputation and a wealth of local knowledge.
· Read their ‘About Us’ section and ask yourself if it sounds professional.
· Google the name of the estate agent.
· Request testimonials.
Contact a lawyer
Another important member of your property-buying team is your lawyer.
· Find an independent professional who will represent your interests and no one else’s.
· Ask around for recommendations and request testimonials.
· Check the lawyer’s credentials by checking they belong to the local bar association.
· Choose a lawyer with experience in property and planning laws.
· Choose a lawyer who speaks good English.
Top tip: Don’t sign anything or hand over any money until you have consulted your lawyer.
Register with a currency specialist
Because your international property transactions will be made in a foreign currency, you must consider the risk of fluctuating exchange rates denting – or even wrecking – your budget.
During this protracted buying process, the price of your property will be fixed in euros but constantly fluctuating in pounds between putting in an offer and completing – potentially causing the price to disappear out of reach. Shield your budget from this currency risk by taking steps to mitigate its impact.
A currency specialist offers solutions and guidance that help you secure a competitive exchange rate – and with it the price of your property.
As well as saving you money on every transfer, they facilitate seamless and hassle-free international payments. A dedicated account manager will answer any questions you may have and guide you through the process.
Pick your property
Now you have a reputable estate agent and lawyer in your corner, it’s time to view properties you have found by arranging a viewing trip to your destination of choice. While there, schedule a meeting with your lawyer to brief you on the buying process. Once you’ve chosen your ideal home and had an offer accepted they will start checking the legal paperwork.
Open a local bank account
Most banks allow you to open an account online, but you might need to physically go to your nearest branch to show proof of identity and sign the paperwork.
Top tips for choosing a bank:
Narrow down your choice by asking these questions:
· Does the bank cater for English-speaking?
· Do they have a good range of branches and ATMs?
· Can you bank online and via an app?
· What do they charge for accounts and transactions?
Buying Procedure
Once you’ve chosen your ideal property, and had an offer accepted, the buying procedure begins in earnest. This will vary from country to country, but the general process will look something like this:
1. Your lawyer conducts full legal checks, such as ownership, planning status, registry details and information about any charges on the property.
2. Your lawyer drafts a pre-purchase contract, including all the conditions of the sale. You pay a deposit and you and the seller sign the contract.
3. Your lawyer completes the legal checks and arranges the signing of the title deeds.
4. Completion takes place – timelines vary in different countries. Your lawyer organises payment of all fees and taxes. You’ll receive the keys.
5. Your lawyer sets up utility transfers and direct debits.
6. If you wish to let the property, your lawyer will provide advice.
7. It’s time to move in, start any refurbishments or begin letting it out.
Looking forward to the future
Once your property has been purchased, you might need to pay ongoing maintenance costs, make pension transfers or move monthly rental income to the UK. A currency specialist can provide you with a tailored regular payment plan at a fixed rate to help save money in the long run.
And should the time come to sell your property, you’ll need a cost-effective way of transferring the proceeds back to the UK. A currency specialist offers secure, simple and reliable repatriation services to help you minimise international money transfer costs and maximise your profit.
I hope this quick guide will help you take your first steps on the path to buying a home safely and successfully overseas.