Are you thinking about buying a home outside of the USA? Many Americans have considered the same thing, especially those who have retired, and the number continues to grow each year. This is especially enticing for those who are hoping to take advantage of the lower cost of living rates to help their savings stretch for longer.
Keep reading to learn more about the steps you should take for buying a home abroad.
Find a Real Estate Agent
If you have decided you would like to own a home in another country you should start by finding a real estate agent who can help you through the process. You should find an agent who has previous experience selling homes and doing business in that country.
If you don’t know anyone personally, you should ask for referrals amongst your friends and family or colleagues who live in that country.
If you do not have any personal connections in the country you are considering, then you can reach out to local real estate offices and see if they have any agents who are able to represent a foreign buyer. You can also research online for any ex-pat communities in that country and seek out a referral through them.
Another great option is to contact the real estate association in that country to help you find an agent.
Understand the Foreign Ownership Laws
There are many countries that have placed restrictions on non-citizens who want to own property on their land. You should check and make sure the country you are interested in moving to allows foreign ownership before you begin the process of buying a home there.
The country you are interested in might allow foreigners to buy a home, but you might have to file for a special residency permit to live there. You might even have to register yourself, and anyone else who will live with you, with the government agency before you can complete the purchase of your home.
If you are uncertain of the laws regarding foreigners owning a home in that country, you can reach out to a real estate attorney who is familiar with how to perform these types of foreign transactions.
Figure Out Financing
Finding financing when purchasing property abroad can be quite a challenge. If you are planning on financing through a bank in that country, then you need to be prepared to have a substantial down payment and be aware of the higher interest rates. Some countries also require that you hold a life insurance policy that will cover the mortgage in case you pass away before paying it off in full.
If you would like to avoid the hassle of financing your home overseas you can always consider paying cash. If you don’t have those kinds of figures in your savings account, you can borrow from the equity of your home or take money from your IRA or 401(k).
You should reach out to these mortgage brokers for more information about financing your new home.
Learn About Your Tax Liability
Before you begin your move to another country you should be aware of the different types of tax rules that might apply to you. Just like in the USA, you will likely be responsible for paying taxes when you buy or sell property abroad.
You might also be responsible for continuous tax payments on your home or property throughout the year. It is important for you to be aware of how this tax liability will impact you before you commit to buying overseas.
Research Everything
Purchasing a home can be a lot of work and is even more so when you are doing it abroad. This is why it is important that you do your research about owning a home in another country before you make a commitment. You may have heard from others who have had a great experience but that doesn’t mean you are destined to have the same luck.
Since you are not familiar with the area or the laws of the country it is easy to be taken advantage of by scammers who know how to swindle you out of your money. If you have done your research, you will know when something sounds fishy and will be able to identify when a certain expectation is out of scope.
Develop an Exit Strategy
The foreign housing market can be volatile and, in some countries, homes can remain up for sale for months or even several years. You might never plan to leave your new home, but you also have to be prepared for the unknown future.
When you are planning on purchasing your new home you should also plan for what you will do if you ever need to move back to the USA. Since it might take a while for your home abroad to sell, you will want to avoid relying on any profit from the sale to make your move back home.
Learn More About Buying a Home Abroad Today!
These are some of the most vital steps you should take when planning on buying a home abroad. Start by contacting a real estate agent who is familiar with the process of buying a home overseas.
Next, research all the laws that are in place for foreigners in that country. If you plan on acquiring a mortgage abroad, you might need to have a large down payment. Finally, be sure to have an exit strategy in place if you need to move back to the USA.
If you’d like more information about purchasing a home abroad, visit our website daily!
