The arrival of New Year is a time when many first-time investors finally plan to buy their dream home overseas.
While the overseas market offers many great value properties for those who know where to look, Chris White, Founding Director of Ideal Homes International, says: “We would always advise buyers to be cautious though, particularly if they haven’t bought overseas before – it’s really important to do your homework and buy through a trusted and reputable company.”
As such, White and his team have put together their 16 top tips on buying a home overseas in 2016, to help buyers turn their dreams into reality.
1. Investigate on the Internet – research potential areas thoroughly, rather than individual properties. Find out about local amenities, from beaches to restaurants, based on your priorities. Think about how those priorities may change in the future as well – a holiday home bought this year could serve as a retirement pad later on, so what facilities would you want on hand then? Don’t fall in love with a particular property until you know the location is right for you!
2. Use an agent with form – opt for an organisation with a good track record. Make sure they have been in business for some time and have a long list of satisfied customers happy to speak about their experiences.
3. Budget carefully – buying overseas isn’t just about the property price. Be aware of the buying costs like fees and local taxes. These can vary hugely from country to country, so do your research and budget accordingly.
4. Plan a trip – once you’ve identified the places you like on the Internet, hop on a plane and check them out for yourself. You will quickly be able to get a feel for whether or not a place is right for you, and a few hundred dollars invested at this stage can serve extremely well when it comes to finding the perfect location for your new home overseas.
5. Know what you want BEFORE you visit – think about how many bedrooms you need, whether proximity to the beach or a local golf course is important to you, whether you simply must have your own pool, and whether the local supermarket can be reached on foot or by car. Whatever your preferences, have them firmly fixed in mind before you visit – and be sure that your agent understands them too. This will ensure that he/she is able to show you properties that perfectly suit your requirements, and avoid wasting time spent touring unsuitable homes.
6. Think about the journey – work out the journey from your current home to the area in which you plan to purchase. What are the flight times and costs like? Is there just one airline that flies into the local airport or several? Can you hire a car easily upon arrival if you need to? These factors will impact on how relaxed you are by the time you arrive at your overseas property each and every time you visit, so think the journey through in detail.
7. Find a reputable lawyer – this is one of the most important elements of buying a second home overseas. A good agent should be able to recommend a reputable lawyer, or you can do your own research on the Internet and by speaking to others who have bought property in the area. Chat on the phone with the lawyer and meet him or her when you visit – test their knowledge and be sure to choose someone you are comfortable with.
8. Think about money matters – once you’ve bought your property, you will need to get money out to that country regularly in order to pay bills, take care of maintenance issues and so forth. Look at what you need to do to set up a local bank account and plan to do this as early as possible in the process. Bear in mind that many overseas banks also have a local branch where you can take care of some of the initial paperwork should you need to do so.
9. Remember the insurance – before you commit to purchasing a property, check that it is insurable and at a reasonable rate. If the area that you like the look of is prone to flooding or sink holes, then it might be time to look elsewhere.
10. Ask about hidden requirements – speak to your agent and conduct your own research online to ensure that you know everything you need to. In Portugal, for example, you need a fiscal number in order to purchase a property. You can get one quickly and easily from the local Finanças department for a small fee – or you can appoint a lawyer to take care of this on your behalf.
11. Consider other significant expenses – what other expenses might your property purchase give rise to? One of the most commonly overlooked items is the need for a car, so think about whether you can access your new home on public transport, whether you will pay for a hire car each time, or whether you would prefer to purchase a car of your own overseas.
12. Is the property just for you? – if you plan to rent your property out as well as using it yourself, then be sure that it appeals to a wide range of holidaymakers. Neutral décor and access to a pool can make a big difference to the number of people choosing your holiday home over another one.
13. Speak to the experts – join some online forums and Facebook groups and chat to those who have already purchased in the area you like. Even better, find people who have moved full-time and benefit from their experiences of local life.
14. Know the market – understand price trends in the country and region you like in order to know whether or not your expectations are realistic based on your budget. Knowledge of local prices will also help you to gauge whether you are paying over the odds or picking up a real bargain.
15. Think about maintenance – unless you are planning a permanent move, you will need to consider how best to maintain your property from afar. An isolated villa might be your dream holiday home, but an apartment on a managed condominium might present far fewer headaches in terms of regular maintenance, particularly if you plan to rent it out as well as use it yourself.
16. Use an agent who does it all – find an agent you trust and who can offer you the whole package. They will be able to support you with every step of the process, from finding a reputable lawyer to arranging an inspection trip. This can often be by far the quickest and cheapest approach – and also the least hassle!
Romesh Navaratnarajah, Senior Editor at PropertyGuru, edited this story. To contact him about this or other stories email firstname.lastname@example.org