The sun is finally here in Britain after an incredibly cold winter and gloomy spring. If you are going away on holiday soon, make sure that you don’t get carried away if you end up looking at overseas properties for sale while you are on your trip!
Many of my clients make enquiries about buying property overseas shortly after going abroad – it’s only natural to follow up on the idea that struck you when you were away from home. However, if you are thinking of buying a property there are some common pitfalls to be aware of – and by keeping these in mind, you could save a huge amount of heartache and avoidable expense.
The first point to make is that while you are abroad you will no doubt be relaxed, full of sunny disposition and good cheer. This means that you will not be your ‘normal’ self, so do make sure that you retain some good common sense! Being away from your home turf, and therefore possibly out of your comfort zone, may affect your decision-making – so please be aware.
Next – remember that if it is too good to be true, the chances are it is. With any investment you must make sure that you have your wits about you and question everything that you are being told.
If the property is a new build, I would advise that you research the developer or agent’s previous constructions or past sales to establish if they have met their own set deadlines and achieved a good quality of work.
It would not be a bad idea for your independent lawyer to obtain financial references on the developer, to ensure that they have the cash resources to complete the construction of the development. He or she could also establish what compensation you would be entitled to, if they do not meet the agreed timescales.
Beware of cheap properties or ‘bargains’. Unfortunately due to the recent world economic crisis, a number of individual properties and developments have been repossessed by Banks. These properties are then promoted back to the general market either by the Bank directly or via nominated Estate Agents. However, it is important to understand and research why the property was repossessed in the first place.
Firstly, is it because there was genuine hardship and the property was legally built with all the relevant planning permissions or building licences? Secondly, is it because it was not a finished property? Were the requirements not met, was it in a poor sales or rental area, or were rentals not even allowed due to local planning rules?
My advice is to not let slick marketing cloud your judgement – take a deep breath and do your research first.
The next important point is related to paperwork. Always get a professional translation done for any contracts and read them carefully. If necessary, seek the opinion of a professional lawyer and never hand over any money unless you are 100% sure what the rules are about getting your deposit back if you pull out.
Always demand a cooling off period of at least seven days, but preferably 14, to give you sufficient time to return home and discuss everything through with your own professional or relevant advisers.
If you are considering buying the property as an investment, then think about what rental value you can get from the property and whether you can rent it out in the low season. Also, consider maintenance and upkeep and who will provide that service and how much it will cost.
By following these simple steps you can hopefully avoid some of the common pitfalls for purchasing property overseas!