Having an overseas bolthole to escape to when things become either a bit tough, or a bit cold may seem like a pipe dream for most of us. But, investing in property overseas may be a financially smart decision.
The most common reasons for buying a holiday home overseas tend to fall within two categories: Investment and personal use. Often, the reasons include a little of both and include additional factors, such as being able to regularly afford a lower cost holiday in a country and location you know and love, the option of retiring overseas when the time is right, and having a property for friends and family to regularly enjoy.
However, before making a hasty offer on a property, you should ask yourself the following questions:
Is it the right property?
Before even considering purchasing a property abroad you must be sure it is the right one for your needs. You probably have a good idea of the country and resort you would like to be in, but have you thought about what features your home should have? What facilities you would like to be near? What is the infrastructure like?
Make a list of your priorities and do your research. Speak to local estate agents and other people who have invested in the area if possible.
Have I budgeted properly?
Make sure you are aware of all the costs associated with buying property in your desired location, in addition to the house price itself there may be taxes, transaction costs and maintenance fees to fork out. You will also need to ask yourself whether the house will be ready to move into immediately or whether it requires renovation work.
How much tax will I have to pay?
Do your research so you are fully aware of the level of tax you will be paying on rental profits if you choose to rent your property. If you live in the UK you will also have to pay UK tax on the income, but you may be able to apply for double tax relief.
Do I want to make money?
Renting your property may, or may not be your primary motive for buying a holiday home, but even if you decide it’s not at the moment, it might be something you need to consider in the future during times you’re not using it.
Research rental incomes in the area and decide whether it’s enough to cover associated costs such as management fees and insurance. You should also consider whether the property is in an area that will attract tourists.
There are a multitude of experts on hand to help you make this huge decision. Companies like www.PortugalProperty.com not only offer variety of properties for sale to suit most tastes and budgets, they are also experts in purchasing property overseas.