Buying your dream holiday home or investing your savings wisely – whatever your motivation for purchasing property abroad, make sure you get yourself properly acquainted with the specifics of the local real estate sector in order to avoid any potential pitfalls. We’ve prepared a list of the top five tips you should pay close attention to before sealing a property deal overseas.
Familiarise yourself with the market
Whether you’re on the hunt for the perfect spot in a tropical paradise or fancy buying property exclusively for investment purposes, it’s essential to understand that market prices are influenced by both global and local trends, political events and international trade, constantly driving values up and down. These cycles of rising and falling prices occur constantly, so to get the most out of any potential deal, you need to thoroughly investigate the market you’re intending to invest in so that you buy at the lowest possible price.
Consult a legal representative before taking action
Just as the overall economic environment affects the property market, national legislation can also have a huge impact. Some governments prevent foreigners from purchasing property altogether, or charge exorbitant taxes for doing so. Certain countries, on the other hand, including Cyprus, Malta and a number of Caribbean nations, offer ‘citizenship by investment’ programmes. To make sure you’re on solid ground before you start your search in earnest and to get fully familiar with any legal issues that may affect your investment, it’s always best to get professional advice from an international property expert.
Use the services of an estate agent
Buying property directly from an owner could save you money, but cutting out the middle man could create headaches, especially if you’re an inexperienced buyer and don’t speak the local language.
When it comes to purchasing property abroad, estate agents are usually trustworthy allies in finding the best place for you, and in guaranteeing that the deal is completed without any complications.
Before putting pen to paper on any kind of contract or agreement, it’s important to read all the small print, so have your documents professionally translated so that you know exactly what you’re committing yourself to.
Save money on transactions
Once you’ve finalised a deal, you’ll have to handle the payment process. When making international money transfers, there are two crucial factors to consider: fees and exchange rates. Most high street banks usually offer poor currency rates and demand a wide range of hidden charges for international transactions. In order to get the most for your money, it’s vital to consider other options, such as Covercy’s industry-leading payment platform, offering some of the world’s best cross-border currency solutions. Let’s say you need to pay €250,000 for a property – with Covercy you’ll have to transfer £213,477 instead of the £218,434 an average bank would charge you. That’s a saving of €5,681!
Think one step ahead
Whether your property purchase is a short-term or long-term investment, always be aware of how taxes, insurance, inheritance rules and rules concerning communal areas could affect your finances. You can save a great deal of money, for example, by deciding on who should own the property: an individual, a couple, any heirs – or even a company. Buying real estate abroad is often a complex operation, but with proper planning and expert support, it can be one of the most worthwhile and financially rewarding decisions you’ll ever make.