When purchasing property abroad, a land of opportunity also comes with its own set of challenges. The process is often more complicated than it seems, and the consequences of getting things wrong can be costly. Research by global property advisor JLL in 2018 found there are currently around 250,000 unoccupied second homes in France alone, which is more than enough proof that buying property abroad isn't always straightforward. Fortunately, with the right advice and preparation beforehand, you can ensure your investment in real estate abroad pays off as much as possible. Here are five common mistakes to avoid when purchasing property abroad:
Not understanding the law regarding non-resident home purchases
In many countries, non-residents are subject to higher taxes and other legal restrictions on property purchases. These restrictions apply to ensure the stability of the housing market and that residents can still purchase homes while restricting an influx of foreigners buying cheaper homes and pricing locals out of the market. While this isn't true for all countries - the UK and France have no such restrictions, the exact rules will vary, and some countries may even require you to spend a specific amount of time as a resident before purchasing.
Focusing too much on location
Location is essential when purchasing real estate abroad, but not at the expense of everything else. Make sure you're buying the best property for your budget, not the one in the best location. While beachfront homes are alluring and worthy of your investment, it isn't worth sacrificing features or quality for the area. You can always change locations later, but if you buy a poor-quality property, it might be practically impossible to sell it again.
Not having a house check before purchasing
Before you sign on the dotted line to purchase a property, you should thoroughly examine the property and its condition. You should hire a property inspector to inspect the property and provide a detailed review of its condition and what repairs or renovations may be necessary.
Not using an independent lawyer
One of the most common mistakes when purchasing property abroad is not hiring an independent, professional lawyer to represent you during the transaction. This goes for if you are recommended a lawyer by your realtors. It can be in your best interest to make your own arrangements. A qualified lawyer can advise you on all aspects of the purchase, from taxation issues and property inspection to local regulations. Hiring an independent lawyer to represent you during the transaction can save you a great deal of time and money in the long run.
Conclusion
When purchasing property abroad, it's important to remember that the process is often more complicated than it seems, and the consequences of getting things wrong can be costly. Luckily, with the right advice and preparation beforehand, you can ensure your investment in real estate abroad pays off as much as possible. Avoid these common mistakes, and you'll be well on your way to a smooth and successful purchase.
