facebook twitter instagram linkedin google youtube vimeo tumblr yelp rss email podcast phone blog external search brokercheck brokercheck Play Pause
Buying Property Overseas: Top 5 Considerations Thumbnail

Buying Property Overseas: Top 5 Considerations

Investment Retirement Funding

After a successful military career, which in most cases included overseas tours, some retired or retiring military officers consider purchasing real estate located overseas. There are many reasons to consider purchasing a property abroad and some of these may resonate with you. Most people that do so often have the thought of owning a vacation home in mind. Others buy property overseas as an investment vehicle which they can rent out and later sell at a higher market rate (after it has appreciated). Whatever your reason is, buying a property abroad is going to be a different experience than the norm in America and it isn't going to be quite the same as living off-base when you were stationed overseas. 

Here are five considerations to take into account when making that purchase:

1. What Is The Purpose Of Your Overseas Property?

This is arguably the most important factor to consider when buying property abroad. It will have a direct influence on everything including the country to invest in, your budget and the viability of that investment. For example, if you are buying a property to relocate, you will need to do a thorough examination of the locality you want to buy into. How is the surrounding area? How are the available amenities? It would actually be best if you lived in the area for a while to get a feel of its vibe and decide whether it’s worth settling in.

If your purpose is property investment, you need to consider all essential factors affecting the country’s economy such as political stability to see whether the property will give you a good ROI (return on investment).

2. What Are The Foreign Country’s Property Ownership Laws?

Each country has laws and regulations regarding how foreigners should go about the purchase of property within its borders. It’s of utmost importance to understand how these laws will affect you before you make your purchase. You don’t want a scenario where you find out that you have violated several restrictions after you’ve already acquired the property - and now the foreign government wants to penalize you or take over your asset.

If you don’t understand a country’s property ownership laws in detail, consult a real estate attorney specializing in foreign transactions.

3. How Will You Finance Your Purchase?

Securing financing for the purchase of a property overseas is one of the most challenging aspects of this venture. If you are not planning on using cash, you could consider using a foreign bank to acquire a mortgage. The foreign bank will require you to put up a huge down payment and most likely offer you a high-interest rate. If that’s not an option, you could consider using a home equity line of credit although that will mean risking your primary residence in case you default on the loan’s repayment. There are many other financing options to consider. A financial expert with experience in international property purchase matters can advise you accordingly.

4. What Are Your Tax Obligations?

It is important that you adhere to tax rules in any foreign country. Before making a home purchase, learn what taxes you are required to pay and when to pay, as well as whether you are eligible for any tax relief. Tax laws and legislation in each country vary widely and you don’t want to find yourself on the wrong side of the law when all you want is some peaceful time in your vacation haven.

5. What Are Your Property’s Resale Prospects?

This may not cross your mind when making a purchase, but it is crucial! Consider finding out how much your property might be worth in five or 10 years time. How long will it take to sell property in that region? How are the local market conditions likely to be in a few years time? Factoring in your property’s resale prospects will help you avoid acquiring a depreciating asset or get stuck in the market for months trying to sell.

All in all, when buying property overseas, it’s crucial that you engage a professional real estate agent, an attorney and a financial advisor conversant with foreign property purchases. 

If you found this article interesting, you might like the following blog posts too:

military landlord? you have estate planning issues


Military TAx break: Sale of primary residence


10 great locations to retire in the us



This content is developed from sources believed to be providing accurate information, and provided by Twenty Over Ten. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.



Disclaimer
Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by C.L. Sheldon & Company, LLC ), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. C.L. Sheldon & Company, LLC does not make any representations or warranties as to the accuracy, timeliness, suitability, completeness, or relevance of any information prepared by any unaffiliated third party, whether linked to C.L. Sheldon & Company, LLC website or incorporated herein, and C.L. Sheldon & Company, LLC takes no responsibility therefore. All such information is provided solely for convenience, educational, and informational purposes only and all users thereof should be guided accordingly. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from C.L. Sheldon & Company, LLC . To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. C.L. Sheldon & Company, LLC is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of the C.L. Sheldon & Company, LLC ’s current written disclosure statement discussing our advisory services and fees is available for review upon request. DISCLAIMER OF TAX ADVICE: Any discussion contained herein cannot be considered to be tax advice. Actual tax advice would require a detailed and careful analysis of the facts and applicable law, which we expect would be time consuming and costly. We have not made and have not been asked to make that type of analysis in connection with any advice given in this blog post. As a result, we are required to advise you that any Federal tax advice rendered in this blog is not intended or written to be used and cannot be used for the purpose of avoiding penalties that may be imposed by the IRS. In the event you would like us to perform the type of analysis that is necessary for us to provide an opinion, that does not require the above disclaimer, as always, please feel free to contact us.