We take a look at five tips that can help you avoid common mistakes and save money on overseas property purchases.
Many people who have traveled abroad have felt the temptation to purchase property overseas. For example, UK residents often consider buying overseas property in nearby European countries like France or Spain, Australian expats are buying property in Asia and North Americans across the borders to Canada, US and Mexico or the Caribbean.
Sometimes the price of foreign real estate can seem very attractive due to the foreign exchange rate favouring the prospective buyers’ currency. Tourists can also become enamoured with a delightful travel destination, perhaps leading to an interest in buying overseas property as a way to spend more time there. Still others might be interested in investing in undervalued overseas property based on the view that it will appreciate substantially over time.
Whatever your motivation for buying overseas property, the following top five tips can help assure that you have a more positive experience in doing so.
Tip #1: Investigate the Market Thoroughly
Although global property price trends do occur, real estate markets in different locales can go through cycles of rising and then correcting lower, which can be independent of each other.
In other words, just because property values are rising in your neighborhood does not mean that they are also rising abroad. Such trends are especially important for investors who will typically want to buy near the bottom and sell near the top of a cycle.
Furthermore, some countries prevent or limit real estate ownership by foreigners, so you will want to make sure that you have the legal right to purchase real estate in that country and under what conditions you can do so before handing over any money in order to avoid scams or disappointment.
Basically, it really makes sense to do your homework about the real estate market in the country you are considering making a purchase in before putting up your money.
Tip #2: Obtain Professional Purchase Assistance
Great deals can certainly be had when buying foreign real estate directly from owners. Nevertheless, if you are unfamiliar with the foreign real estate market, then purchasing through a professional real estate agent or from a reputable property developer can provide useful guidance that can help you avoid many pitfalls when buying overseas property.
Such professionals typically have an obligation to see that you are properly informed about the details of the purchase. They will also usually make an effort to complete the deal and assure your satisfaction with it.
Tip #3: Hire a Legal Representative
Although real estate deals in your country of residence generally do not require the services of a lawyer, having an independent professional attorney representing your interests and watching out for potential legal problems can be invaluable when buying overseas property.
Tip #4: Have Key Documents Translated
Before signing any documents relating to a potential real estate transaction, make sure that you have them professionally translated if they are written in a foreign language that you are not entirely comfortable reading. In general, you need to know exactly what you and the seller are agreeing to in words that you can clearly understand.
Tip #5: Saving Money on Mortgage Payments
Once you have read, understood and agreed to the terms of an overseas property purchase, you will then need to make arrangements to pay for it.
When transferring funds denominated in your domestic currency to either make a payment in full, a down payment, or a series of smaller mortgage payments, you will probably want to find a better foreign exchange solution than simply visiting your high street bank.
Such local banks typically provide poor forex services, which often involve very wide dealing spreads and limited transaction sizes. Fortunately, you can usually do much better by changing your money through a regular payments service, such as that offered by OFX.
To speak to one of the accredited OFX dealers about your foreign exchange requirements call 0845 686 1950 in the UK; 1300 300 424 in Australia; 1800 680 0750 in Canada or 0800 161 868 in NZ or go to https://www.ofx.com to register on line with 3 easy steps.
Registering with OFX is FREE and you can view their live dealing rates immediately. Remember to mention you are a client of BestExchangeRates you will receive all your transactions fee FREE!