Top Tips for Buying a Property Abroad

05 August 2014

An increasing number of people are following their dreams and making a permanent move to foreign climates or buying a second home abroad. If you’re planning on buying abroad, avoid getting burnt and read our top tips before you buy:

1. Contracts

Never sign a contract that you do not understand. If two versions are provided for example English & local language, ask your solicitor to confirm the English version is a true translation.

Always read the contract! Ensure you are fully conversant with the terms and conditions you are about to agree to.

2. Arranging finance

If you require mortgage finance, obtain an 'Agreement in Principle' for your mortgage before agreeing to purchase the property, or before signing any contracts and paying a deposit.

If you are arranging finance on the property, ensure that this is stated in any contract and, where possible, seek an 'opt-out clause' if the loan is not agreed (which will ensure any deposit paid is refunded).

3. Specialist advice

Always ensure that you seek specialist advice from independent solicitors, valuers, architects and surveyors before considering a purchase overseas. They should be proficient in your chosen country's laws and processes and also know the specifics involved in buying a property there. It is essential they confirm to you that all required permissions, licences and planning consents have been obtained.

4. Valuation

Before proceeding with the purchase (especially with a re-sale property, regardless of age), ensure an independent valuation of the property is carried out, which should point out any problems with the property.

5. New Build

If buying from a developer, what's their track record and how long have they been trading? Check comparable properties in the area and any re-sales offered on the same development.

Before making any commitment, try to give yourself a 'cooling off' period if you see a 'must-have' property and are tempted to put down a deposit there and then.

7. Location, location, location

Conduct thorough research about local facilities and transport. People gravitate to locations with a nearby airport, especially if it's served by a budget airline.

Proximity to basic facilities like restaurants, shops and a beach are also important. Talk to people who already live in the area you like to get a better understanding of what it's like to live there. Consider the property off-season - many resorts are seasonal and practically shut down when the tourists return home.

8. Local money

Open a bank account in your chosen country and, where relevant, ensure you obtain a Certificate of Importation for the money you bring in from your home country. Set up standing orders in your local bank account to meet local bills and taxes. Failure to pay your taxes in some countries such as France, Portugal and Spain, could lead to action by the authorities.

9. Extras

Bear in mind that bills don't end at the asking price. Lawyer's fees, IVA, local and national taxes and insurance must all be met in your host country and can often add at least a further 10% to your cost of acquisition. Ensure you are, therefore, aware of the costs charged by the legal and government authorities for purchasing a property in your chosen country.

10. Tax

Check the inheritance and capital gains tax laws of the country where you are buying. For example, in France your children automatically inherit rights to your house; your estate may not automatically pass to your spouse and you may, therefore, need to compile a separate will.

For further advice, please call us on 01483 543210 or alternatively email