After months of searching you have finally found it, your dream property. Now it is time to start the legal formalities of purchasing it. It is natural when buy a property to get excited thinking about the days you will soon be spending here, however it is important to not get carried away in all the excitement and leave the rational part of your brain back at home! With that in mind here are the five most common mistakes people make when buying overseas property.
Buying a property that is illegally built
My philosophy is that prevention is better than cure. That is why I advise all my clients to ask questions about where a property has been built. For example, if a property has been built on an area that should have been set aside for green belt or agricultural land, then the chances are there is a risk. Make sure you take advice from an independent, English speaking lawyer, who is preferably not from the same area as the property.
Buying a property that has no planning permission
In some cases there can be problems with properties that have been constructed with the wrong permits, permits that have been granted as a result of corruption or with no permits at all! An independent lawyer can hopefully save you the heartache of seeing your newly purchased dream home demolished! Your lawyer should check the paperwork to confirm that all parts of the property have been built under the correct legislation. Local rules differ from regional legislation, so checks should extend further than the area where the property is being, or has been, built.
Not checking that the relevant licences are in place
Planning permission is of course an important point to consider but you must also think about which licences the property needs. Not having the correct licences (such as “Habitation”) could have an impact on what utilities you can obtain and access to gas, water and electricity may not be granted by the local council. Watch out if you are buying a property in an apartment block or within a large development as sometimes the developers will not register your property for the correct licences until all the properties have been registered in each purchasers name. Be sure to establish exactly when relevant licences will be issued as this may take months.
Buying a “basket case”
A common problem which is often highlighted in TV coverage is poor construction. Make sure you always obtain an independent valuation, ideally from a professional Surveyor expert in that country, even if it is a new property as this will highlight any problems. New properties can sometimes be built in poor soil and with insufficient foundations, substandard building materials or in dubious locations such as flood plains. If you are buying a new property be sure to check out the developer’s past building record and look into re-sales on the existing development to see how they have ‘weathered’.
Not checking contracts
When purchasing abroad it is common to only receive one contract in the local language, in which case, you MUST get a professional translation completed. If you are given two copies of a contract which include the original and a supposed translation, get the translation checked by a professional and do not cut back and get a cheap translation. Check that the translation does not contain any errors, omissions or additions, otherwise you could be unwittingly agreeing to extra conditions or charges not covered under the original contract. One simple check is to see that any translation you are given has the same number of paragraphs as the original. If not, then there is almost certainly a problem.
Buying overseas should be no different to buying at home – take the relevant precautions to ensure that you are minimising any risks and generally things should be fine.