Is now a good time to BUY ABROAD?
may come as a surprise to hear that, post-brexit, not much has changed in the overseas property market, says Simon Conn, an overseas property and finance specialist. However, due to the financial crash of 2008, it is more difficult to buy abroad than it used to be.
Rules vary from country to country, but lenders in popular holiday destinations such as Spain, Portugal, France, Italy and the USA will expect you to put down a deposit of at least 20% to 40%, says Simon. On top of that, they will typically only allow you to allocate a maximum of 30% to 35% of your net monthly income towards your existing debts and your new overseas mortgage. This can significantly restrict how much you can borrow and means most people who buy abroad will either need to do so in cash – setting aside at least 10% of the purchase price for local taxes and legal fees – or have a high income and very little debt.
If you are thinking of buying abroad, it’s crucial to get legal advice. ‘Don’t use the same lawyer as the seller or the developer you’re buying from,’ says Simon. ‘If you do and there’s a problem, it may not be in the lawyer’s interests to be transparent and upfront with you about it.’ Secondly, get a translator to translate any legal documents before you sign anything. Finally, he recommends always getting a private survey done.
One tip is to look for a property professional in the country of your choice who is a member of the Association of International Property Professionals (aipp.org.uk). This non-governmental, not-for-profit organisation offers advice and support to British buyers of foreign property and ensures its members abide by a strict code of conduct.