For everyone who’s been following my blog, you’ll remember that I wrote an article about what every property investor should be aware of when buying properties abroad a few weeks back.
This week, I’ll be serving up additional tips on this topic as more people are looking to buy overseas property either as an investment or as their retirement home.
House hunting abroad
Try your best to spend time on the country you’re planning to invest in. This time shouldn’t be squeezed in with your holiday trip, mind you. You must plan a visit abroad specifically for looking at properties. This is important for you to be in the right frame of mind when you’re choosing a property to buy.
When it comes to planning this house hunting trip, however, don’t be tempted to schedule it at a time when the weather is very idyllic. Plan it at different seasons so you’ll have an idea what the property looks like at its worst and its best.
Case in point, houses in the Alpines could see no sunlight at all for large parts of the day if the orientation is wrong. While in Spain, some hillside villages can be unbearably hot in summer then it turns frozen and miserable from late autumn onwards.
Don’t buy the first house you see. This is one of those rules that can be applied whether you’re buying in the UK or in Spain, because the exteriors aren’t the only thing to be considered in property transactions. It’s important to look around different properties in the areas to get the best value for your money.
That being said, it’s also advisable to work with multiple agents when looking for property abroad. Foreign agents shouldn’t see you as a captive customer, otherwise you might fall victim to their sales tactics.
One of my friends who bought a house abroad warned me that the agent she worked with purposely showed her a string of mediocre properties and then only showed her a decent property at the end of their tour. She only learned later on that foreign agents usually do this so that buyers would be left with no choice but to buy the last property, since it’s the best out of the lot they were shown.
Getting the funds
Much like the process of buying houses in the UK, you have to figure out how you’ll pay for the overseas property you want. If you have the cash, then purchase it on cash basis, but if you don’t have deep pockets to fund your dream there are two other options available for you.
The first option requires you to borrow extra money against your British home to pay for the overseas property. Thousands of Brits have purchased a house abroad this way, because mortgages of this nature are cheap and easy to get.
The other option is for you to take out a mortgage against the overseas property. Big, multinational banks usually offer these loans, but there’s been an increasing number of local banks in many countries who are willing to lend to foreign citizens.
Personally, I can’t recommend which option is “better”. Each investor’s situation is different, so a good option for some may not be the right option for others. Don’t forget to read the terms carefully and think very carefully of what it is you want to achieve with the property. Be responsible with your money and you will avoid problems later. It’s as simple as that.