5 things to consider when purchasing property abroad
It’s well known that moving abroad can be exciting, stressful and most of all expensive. Once you’ve found your dream home, working out the cost of the property is just one part of the process. There are many extra costs that you may need to budget for.
Thinking of a few key questions to ask your seller or estate agent will go a long way in ensuring you get the best possible deal, so here are five key things to bear in mind when it comes to buying property abroad:
1) Source your own legal advice
It can seem convenient to seek advice from a lawyer employed or recommended by an estate agent or developer. However, take heed because occasionally they can be acting for both parties. Appointing an independent lawyer will ensure an honest opinion on all your legal matters when buying your property. Alternatively, if you decide to go with a recommendation, there are a few things you can do to make sure your best interests are in mind:
- Check they are qualified to practise in the UK and overseas
- Check they experience working in your chosen country
- Check they specialised in property law
- Check they are registered with the Law Society
Being vigilant when choosing your legal representative can save you a lot of time, money and frustration further down the line.
2) Research mortgages
It is always recommended to research mortgages thoroughly before committing. Comparing offers from different lending companies will ensure you receive a better rate. Remember, the mortgage suggested by a seller’s agent might not be the best offer, so it’s recommended to shop around.
If you’re unsure of any terms and conditions, ask the lender to clarify these for you so you know exactly where you and your money stand. The main aspects of mortgages to keep in mind are:
- Interest rate
- Repayment method
- Set up fees
- Early repayment and/or cancellation fees
- Local currency variation
Make sure you understand all the aspects of the mortgage you’re agreeing to before signing the contract.
3) Be aware of any extra costs
Unfortunately there’s a lot more to buying a property than simply paying for the bricks & mortar, so why not make a plan of the money needed to pay for the house and a separate plan for the expenditure that will come with it? The list can seem extensive sometimes, but important peripheral costs to look out for are:
- Financial advisor (tax affairs for UK and overseas)
- Chartered and/or quantity surveyor
- International bank transfers
- Legal advice
- Connection for water, electricity & other utilities
Keeping in mind these additional costs will ensure you don’t get caught out financially; for example if you were to receive a plumbing bill, or if you need to hire a translator at short notice.
4) Leave no stone unturned
Make sure your new home is everything you hoped it would be! Even though the seller may appear perfectly friendly, it’s no slight to them just to check that everything is legal and in good shape before any money changes hands. Here are a few things to consider when liaising with the seller:
- Does the seller own the title deeds to the property?
- Does the seller have any outstanding utility bills that you could become liable for?
- Are all the utilities connected and can you use them?
Another good tip is to talk to the other people living in the area, as there may be issues you’re not aware of, such as weather extremes or local electricity problems.
5) Shop around for the best currency rates
Currency rates are one of the most unpredictable parts of buying property abroad. Sometimes they can work in your favour, making purchases cheaper with the exchange rate. Other times, not so much!
Aside from putting your money in the hands of the currency exchange gods, there are a couple of other choices:
- Forward Contracts – occasionally you might want to consider a Forwarding Contract as this can fix the exchange rate. This means you will be clear what how much you are spending.
- Currency Specialists – Researching the different banks and currency brokers will give you a clearer idea of the exchange rates available.
In most cases, it is best to seek professional advice to ensure you are getting the best possible deal for your money.
Buying property requires a lot of negotiation over timings and prices. These are the aspects we naturally have to roll with in order to find and purchase the ideal property.
However, it’s important to keep in mind what will benefit your side of the bargain, and by considering these simple tips, you can save money and at the same time be absolutely clear you’re buying good quality property.
Sponsored article written by Alex at Currency UK