Relaxing on a lounger by the pool, it’s easy to daydream about living this lifestyle forever and naturally thoughts turn to purchasing a dream property abroad whether it’s for investment purposes, as a holiday let or somewhere to retire to. However, getting it right requires a lot of planning and disasters like, demolition of illegally built properties or long, expensive legal battles are things that can and do happen. Here are 5 things to consider before taking the plunge and buying a property abroad.
- Research, research, research
This is the key to avoiding disaster. Research every aspect of buying an overseas property from the specific location or area you would like to live in to local laws. Thoroughly checking the developer or property seller, the property itself, all the paperwork, all costs involved and your own finances are all crucial to a smooth purchase. It may be time consuming and ruin the fantasy of a house in the sun, but better to know now than end up in hot water over a lack of knowledge.
- Find independent advice
You may find that estate agents or developers will have their own translators or legal advisors, making the whole process easier and simpler for you. However, relying on these could be a grave mistake if they have some bias towards the interests of the developer or property seller. Don’t take shortcuts. Find your own independent translators and legal advisors who are English speaking and experienced in dealing with the purchase of overseas properties.
- Talk to the locals or expats in the area
No one will know more than native locals or expats in the area who have already been through the process that you’re considering. They may be able to give you tips and advice about things you may not have considered. Locals might know of good, tradespeople or contacts or similarly, warn you about dodgy dealers and estate agents. Expats in the area will be able to give you a detailed account of the process and planning they went through to have the dream you’re aiming for become a reality. You’ll also get insight into what it’s like day-to-day living there.
- The fantasy is fun, but you must be realistic
It’s easy for even the most sensible person to get swept up in the fantasy. Long, sunny days, a relaxed lifestyle, good food, good wine and smiling locals sound great, but is this really what it’s like to live somewhere? Make sure you take a pragmatic approach, creating a comparable budget for living costs in your new destination to see how it really adds up and find out what all the extra costs for the move like translation costs, legal fees and moving costs will be. Go into it with your eyes open to avoid any nasty surprises.
- Get a good deal
Getting a good deal on the whole cost of the move could save you thousands of pounds. At all stages of the process, keep an eye out for rip-off prices, but also know when to shell out for a good service. One area where big savings can be had is in sending the money abroad to pay for your property. Using a specialist, exchange broker will ensure you pay lower fees and get a more favorable exchange rate. Peter Theuninck, Head of Trading at Baydonhill advises that, ‘Forward contracts offer protection against market events beyond your control and create upfront cost visibility, all in one product.’ A forward contract allows you to fix the cost of currency for up to two years, meaning you will get the best deal on currency when you move and that rate will still be available if you need to repatriate funds should you find you want to return to the UK.
The take away message here is to try, however hard that might be, to take a grounded approach to buying property abroad. It’s an expensive thing to do with many and varied pitfalls to look out for, but by following the steps above, you can minimize the risks to help ensure that you will one day be sipping a martini on that sunny veranda that you have dreamed of.