Buying real estate is always a huge decision, but purchasing a property in another country is even trickier. Apart from tax implications in your home country, you need a lot of other things to sort out. We will provide tips for buying real estate abroad today
There are many pitfalls buyers can run into along the way if they’re not careful. Before signing on the dotted line to buy a home or investment property, do plenty of research. These helpful tips will help ensure international buyers make the right choice when purchasing real estate abroad.
Have the Property Inspected
Just because a property looks great in pictures doesn’t mean it’s move-in ready. Before making a purchase, it’s wise to have it inspected by a handful of professionals.
For instance, local plumbers will make sure the plumbing is right and pipes are in working condition and up to code.
A roofing company can ensure the roof is free from damage. An electrician will inspect the wires for any hidden dangers.
While it’s tempting to hire just one person for an inspection, getting the opinion of several independent professionals is best.
If the inspection report lists any problems, the seller may be willing to make repairs.
However, if there is a lot of damage to the property, it may be best to walk away altogether.
Work with Real Estate Professionals
Searching for homes abroad isn’t always easy. Most foreign buyers are unfamiliar with the region, and they may not know which neighborhoods are family-friendly.
That’s why it’s better to team up with a local real estate agent who knows the area.
An agent will locate properties that meet the buyer’s needs. They will also redirect their client away from potential money pits.
A real estate professional acts as the primary liaison between the buyer and the seller.
They will help negotiate a fair price and close the property on time.
Different countries may have rules and restrictions in place for foreign buyers, and a real estate agent will ensure their client doesn’t run into any preventable issues down the road.
Research the Real Estate Market
Even with a real estate agent on your side, it’s best to research the market before looking at any listings.
Real estate prices fluctuate frequently.
While there are global real estate market trends, not every country will follow them.
For instance, if housing prices near the buyer’s hometown are falling, they may be rising abroad.
Making an offer when it’s a seller’s market may cause the buyer to overpay.
Buyers should familiarize themselves with the local market to ensure they know when it is the right time to buy.
It will give the buyer leverage to negotiate a better price.
Understanding the current market will even help overseas buyers avoid potential pricing scams or shady sellers.
Visit the Property in Person
Would anyone purchase a local home without seeing it first?
It may come as a surprise to learn how many foreigners buy properties without ever touring them in person.
While photos give a general idea of what the home looks like, they only tell part of the story.
Visiting the property in person brings awareness of any deal breakers.
For instance, the buyer may find out the home is located next to a busy road.
They could also stumble across damage that wasn’t noticeable in photos. Before signing a mortgage contract, schedule a trip to tour the property with an agent.
Hire Legal Representation
Most people feel comfortable purchasing a local home without getting legal advice.
However, there are a lot more risks involved when buying abroad.
Hiring an independent lawyer is the best way to navigate the buying process without running into any legal problems.
What legal issues could arise? Not every property on the market is up to code, for instance.
If the home doesn’t meet current regulations, the buyer may find themselves liable for correcting these issues after they close.
These types of problems commonly arise in older homes. An attorney will make sure the property has all the correct permissions in place beforehand.
Translate All Documents
It’s never a good idea to sign something without understanding it fully.
When purchasing a home overseas, it’s common to receive documents that are written in a foreign language.
The buyer shouldn’t blindly agree to the terms.
There may be something important hiding in the small print. Instead, always have every document translated before signing.
Many people attempt to run documents through an online translator, but these programs are not always accurate.
It’s better to hire an expert who can translate everything to the buyer’s preferred language.
If something still doesn’t make sense after translating, be sure to ask for clarification.
Plan for Time Away
After purchasing, who will manage the day-to-day upkeep while the owner is away?
Unless the buyer wants to move into their new house permanently, it’s critical to make plans for when they travel back to their primary home.
Things to consider are landscaping, housekeeping, and utility maintenance.
Buying a home in a managed community is one way to avoid the headaches of maintaining an international property.
The owner may also consider renting out the home. However, it’s essential to verify if it’s legal to sublet the house.
Breaking any rules on subletting, even if by accident, may land the owner in hot water.
Plan Ahead for Mortgage Payments
Managing a mortgage abroad is much different than making a payment locally. Many foreign banks aren’t equipped to handle large transactions from overseas customers.
Those that do may charge exorbitant fees to transfer a mortgage payment. Instead, the homeowner needs to find a better, more affordable foreign exchange solution.
The exchange rate changes daily. Getting the lowest rate is a must when paying for an international mortgage.
The most skilled investors rely on forex trading to help them find get the best rates possible.
When the rates are exceptionally low, it may be more cost-efficient to make multiple payments at once. The better a homeowner plans financially, the more money they’ll be able to save in the long run.
Find Your Dream Home Abroad
Buying a home abroad should be a rewarding experience. However, first-time international buyers often feel out of their element when shopping for properties overseas.
Getting advice from multiple professionals along the way will help streamline the process.
Following the above tips will ensure any buyer will be able to find the right property for their family.