Posted on November 14, 2014, 11:45 AM, by Mike Sannitti under Adjusting to Your International Move
Moving abroad is always a daring and challenging thing to do. How do you buy a home when the homes on the market are many miles away and usually overseas? There is also the
problem of the vastly different real estate laws in foreign countries. Even if you aren't moving overseas and just want to purchase a vacation home in a foreign country, you still face the same challenges. How can you buy a home abroad without getting burned?
Research the regulations required for your target country
Entering, living in, and purchasing property in a foreign country all require specific documentation and authorization. Contact the consulate or embassy of the country where you want to buy a house and ask about each step of the process. Because each program is so specific to the country, we can only provide you with some general advice:
- You always need a passport and sometimes a visa to enter a foreign country.
- If you plan on moving to the country for an extended period of time, you need to apply for permanent residency.
- Some countries require you to obtain permanent residency before you can purchase property.
- Some countries may not allow non-citizens to purchase property at all.
- Research the particular neighborhood where you are looking to buy. Information about the whole country may be too general to be practically useful.
- Mortgages in smaller countries are not like what you would expect in America. You often need to pay a 40 percent down payment at the beginning of the mortgage. Other countries will only allow you to purchase a home outright in one lump sum, omitting mortgages altogether. You can expect to find more traditional mortgages in places like Canada and Britain.
Finding a good home to buy
If you are able to buy a home in a foreign country, you need to find an appropriate one to buy. This can be difficult since you probably can't make several trips abroad to view houses. You have to make your time spent abroad count when looking for a home.
- Hire a good international real estate agent. Agents with experience in international real estate can make the whole process much easier for you if you're willing to pay the commission. Ideally, you'll want an agent who has experience closing deals on houses in your specific destination country. A good agent can help you sift through all the foreign ownership regulations and will find homes within your budget much more quickly than you would alone. Your agent can also arrange for viewings in targeted neighborhoods. It is very important that you screen any agent you hire, since much of the process can be placed in their hands.
- Be wary of local scams when exploring a neighborhood. You are a target as a foreigner who is unfamiliar with local laws, customs, and regulations. Only buy what you can see. Don't believe that anything will be built or repaired in the future. Try to work with an experienced real estate agent to avoid scams.
- Be wary of online scams, as well. If you are shopping for a home online because you can't visit another country in person, you need to be very skeptical of anything you find. Screen all your sources of information. Look for certifications. Go through a real estate company. Make sure the listed homes have many photos and details accompanying their profiles. There is no guarantee that any home you see online actually exists.
- Be flexible. You have a limited number of options when choosing a home to buy abroad. Make a list of your top priorities and ignore the problems you can tolerate. Remember that the primary reason why you want to buy a home abroad is the location. Everything else should matter less to you.
- Don't be surprised if sellers expect bribes in smaller countries. American real estate rules don't apply everywhere. Don't expect guarantees without signed legal documents. You can think you have a deal set and someone could offer more and take the house away from you last minute.