Invest In Property Hotspots
Every year some well-known and less well-known countries show substantial growth in their economies or in their potential as tourist destinations. Savvy investors from around the world head out to these new and emerging locations with one thing in mind-to buy property in a place which shows the most favorable return on investment. It’s a temptation which is difficult to resist especially when continental real estate agents have their offices in sight-seeing hotspots with huge tourism potentials or where the exchange rate is in their favour. These new and emerging property hot spots can provide fast and lucrative rewards to the smart investor.
Whatever the motivation for buying abroad, may be, our eshreen.com Top 20 Hot Spot Countries will provide the perfect guide on where and what to buy right now.
Buying Off Plan
Buying an off-plan property allows many investors to buy something that they perhaps would not be able to purchase on the ready-made market, where all the money would be required immediately, directly or through a finance provider. The main benefit of purchasing off-plan is that you can spread the payments out over a longer period of time as well as achieve a lower final price than if you were to purchase a similar completed property. Many new developments selling off-plan gain value so quickly that the property price can double even before the final instalment payment is made. Unique developments in select areas will quickly gain demand. In some instances, a new development can sell its units in a matter of hours or days and the savvy investors able to get in on the first stage will reap considerable rewards in a short period of time when they re-sell.
Check out the eshreen.com latest development project across the world.
Use A Real Estate Broker Or Agent
There’s no denying the fact that you might get a great deal when you make a property investment directly from the owner. However, if you are buying a property from a foreign country, you may struggle with the language or investment laws and hiring the services of a reputable broker or real estate agent can help you avoid a number of pitfalls. Professional real estate agents are obliged to properly inform you about the details of the purchase and they would also make an effort to ensure you complete the deal with maximum satisfaction. eshreen.com provides a complete service for buyers including research and brokerage.
Fees And Taxes
When purchasing overseas, there will be foreign taxes and additional fees that you may need to consider in order to move forward with your property purchase. These may be some of the fees to consider; Fees for a financial adviser to manage your tax affairs both in your country of citizenship and overseas. You may be liable to pay tax if the property is sold.
Fees for a chartered surveyor or quantity surveyor
Mortgage fees – these may include a mortgage broker fee, an arrangement or opening fee, and an administrative fee for the bank to appoint a representative to manage payment of taxes and inscription of the title in the property register
International bank transfer fees, which you should discuss with your bank in advance.
To make the right purchasing decision you need to understand how you may be taxed on any income or gains on your property, both in your country of residence and your home country. If enforcement of tax laws is lax or ambiguous, don’t count on this remaining the case forever. Remember also that tax laws change, so if you decide to buy, you’ll want to keep up-to-date with current laws as they apply to your situation.
Selling the property has major tax implications, especially if it is being sold due to the death of the owner. Capital Gains tax and Inheritance Tax must be factored in when buying in those countries where it applies. Our Property Investment table will give you some useful data to help you make these calculations.
Legal Checks And Processes
Once you have selected your property the next thing is to check for the legal details relating to the property. There’s almost invariably some form of title, written records, some appended history, and a series of contracts which determine who is buying what from whom. A first contract is often a preliminary contract which states the owner’s commitment to sell and the buyer’s commitment to buy while the second is the completion contract which finalizes the deal.
There are also documents to be made on the status of the property such as plans for new developments, covenants and the physical state of the building. When hiring lawyers for your purchase, you should be mindful of their cost.
You would also need to confirm that the property has a clean title and you should establish a planning status for the propert y, especially when buying from a developer. You should also find out what is likely to be built close to your property in the future and determine whether it is necessary as a non-citizen to obtain an official permit before purchasing a property.
When entering into a property deal, it is important you hire the services of an independent lawyer as their advice can be invaluable in case any legal wrangles occur.
When hiring a lawyer, it is usually recommended you get one who is familiar with the rules of property investment in the country where you intend on investing.
You could get one via recommendation from an attorney in your country of origin or dive right in and get one from the country yourself, but you would have to be careful so it’s advised you stick to reputable law firms in the country where you intend on investing.
Also don’t forget before putting pen to paper on any potential purchase, ensure you have the documents professionally translated as this ensures you are in the know on what you are appending your signature against.
eshreen.com can provide a complete service for buyers and assist in the hiring of reputable local lawyers. See our services page and contact us for more information.
Financing
Before you make an offer for a property, consider how you will fund the purchase. If you don’t have enough funds to make the purchase out right, you could either borrow more money against your current property to make the purchase for the overseas property. Or you could take a mortgage against the foreign property in the local currency which you can either take from a branch of a major bank such as Barclays or HSBC which you are banking with or take a loan from the foreign country where you are investing. There is an increasing number of local banks in countries willing to give loans to foreigners.
Once you have read and are clear on the terms of the purchase, you should then proceed on the terms of the purchase. When making payment with funds in your domestic currency, you would want a better foreign exchange rate than what you would get from your high street bank. This applies whether you are making payments in full, dropping a deposit or setting up a mortgage plan.
Typically, local banks provide foreign exchange services which involve wider margins on exchange rates, limited transaction sizes, and higher fees which makes them a bad deal for you. Often, it is better you change your money and set up a payment plan through a money transfer service.
Overall, buying real estate abroad is a smart choice, especially in a world which is becoming a whole lot more integrated. Business opportunities abound everywhere and a piece of real estate in a country of your choice may just be the door to a whole lot more opportunities.
Check out our Investment Calculator to work out your finances.