After the several ‘Beast from the east’s’ which we have had, many of will have dreamt of living in a hot country. Unless you are of retirement age, don’t have any dependants and you have saved enough money over the years to provide you with a comfortable standard of living, it might have to stay as a dream for now. The other option you may think of is buying a property abroad to use just as a holiday home, which you plan to visit whenever you get the chance.
At first, this may seem like a great idea, but before you make up your mind you need to act with caution and do your homework.
You may have bought and sold many properties over the years and feel comfortable with the processes which take place in England, but other countries can be very different to our own. You only have to travel north of the boarder and you will find that if you make an offer for a house, you are obliged to buy it, even if you later find that you can’t get the finance or the sale of your home falls through, with potentially very costly repercussions in some cases. Every country has there own rules and regulations which you need to be wary of, and it’s not just with the house buying process itself, but with things such as insurance, council tax and homeowners’ rights and obligations.
Another more obvious reason is that most people wouldn’t want to go on holiday to the same place every year, which is probably truer for more people than they think. Many places would feel idyllic the first time you go there with a week off work, sat in the sun sipping cocktails, but unless you are the right type of person who can enjoy the same place time and time again, that enjoyment may become less each time.
If you do make a mistake and want to sell up, you need to be aware that in some countries the housing market is much less liquid than it is here, and you might be stuck for quite some time, which can cause a variety of problems.
It’s not all bad; there can be benefits to buying property abroad. If you choose the right place, you can get a lot more for your money than you can here and potentially make good returns on both incomes if you let your property to holiday makers, and capital gains if it is in a town and country with the potential for growth.
So if you are thinking of buying abroad, make sure you do a lot of research. Visit the area a few times, speak to the local people and if you can other Brits who have done the same. If the move is going to be a permanent one, make sure you find out how it will affect things such as your tax status, your state pension and your health care situation.
Kieron Bassett Financial Services has two Independent Financial Advisers who specialise in mortgages and investment advice. Contact us on (01524) 832057, via e-mail, firstname.lastname@example.org, or visit www.kieronbassett.com.
Jason Hinde FPFS, Cert SMP – Chartered Financial Planner
9th April 2018