Buying property abroad is an attractive proposition for those who dream of a money-making place in the sun. Yet there are many types of overseas property investment ideas to consider beyond holiday homes – options range from commercial land developments to student housing. In all of these cases, purchasing property abroad adds a layer of complexity to the process. It’s therefore important to keep the following factors in mind before jumping in.
Tried and true locations are easier to finance
If you’re investing overseas for the first time it’s generally recommended to play it safe in time-tested markets. Lenders look more favorably upon these properties, and established areas such as a popular beach resort will have extensive infrastructure already in place. Think about the long-term picture, delving past the latest hotspots that may fall out of fashion by this time next year.
Be prepared for an added layer of paperwork
There are plentiful benefits to overseas property investments, but simplified paperwork is generally not one of them. Be prepared to cut through the red tape and tick all the bureaucratic boxes to get your investment off the ground. This includes learning about local laws for foreign investors, as well as investigating title deeds thoroughly. Don’t forget, when working in different languages, it’s particularly important to get all correspondence in writing. In cases where you’re not fluent in the local language, research the country’s guild or certification scheme for translators and interpreters to assure yourself of the quality of any materials you receive. In some countries, such as France, important documents should be stamped with the translator’s registration number to certify accuracy. It’s worth having contracts checked by a second translator to ensure accuracy.
Rules vary from country to country
As mentioned above, all countries have different specific laws to deal with foreign investments. For example, in some cases you may need to purchase land through a bank trust. Beyond legal aspects, real estate is handled differently from country to country. In many regions square-footage calculations include both indoor and outdoor spaces, while others will include only indoor space. Finally, you must be aware of required vaccinations, visas and entry fees – these rules can generally be obtained in your home country from the future country’s embassy.
It’s best to visit before you buy
Potential overseas property investments may look alluring in the brochures, but you don’t know what a location is really like unless you see it in person. This is particularly important for new developments, which may not look anything like the architectural rendering when completed. Ideally, you will pay multiple visits to the site to learn more about infrastructure, building quality and the local rental market before you put down any deposit.
Factor in exchange rates and taxes
Consider the tax implication both at home and overseas before making a purchase. Like other details, this will vary depending on the destination. In most cases, any rental income will need to be declared in your home country. Be aware of currency fluctuations and always keep a close eye on the exchange rate. Markets with a volatile currency may not be the best option as your investment could swiftly lose value.
You will benefit from a local’s perspective
It’s virtually impossible to handle overseas property investments successfully without local assistance. You’ll need a lawyer on the ground with in-depth knowledge of the local property market, as well as a buyer’s agent who can answer all of your questions.
This is why it’s a good idea to hire a real estate company with an extensive network like Bliss Imobiliare to assist you when you are from outside and want to buying property in Romania. Our agents and advisors can help streamline the process, increasing your chances of a lucrative and satisfying investment.
