The Foreign & Commonwealth Office (FCO) is teaming up with 'A Place in the Sun' to urge those considering a move abroad to think long-term and plan thoroughly.
We ask Cara Fortune, from the FCO's Know Before You Go team, and Liz Rawlinson, Editor of A Place in the Sun Magazine, about the importance of being prepared before moving abroad and the research we should be doing.
Can you buy easily outside the EU?
Liz: You can in some places, however it differs between countries. For example, four of the most popular non-EU locations for British nationals are the USA, Canada, Australia and New Zealand as it is relatively straightforward to buy properties in these countries.
Do you have to be a cash buyer or can you get a mortgage?
Liz: This is completely specific to different countries, however, you are able to get a mortgage in many popular locations. In France, there is arguably more choice and buyers habitually take out a mortgage. In Spain and Portugal, options are increasing all the time, however Italy, Greece and Cyprus are a bit trickier.
Are there high tax rates in certain areas/countries that make it prohibitively expensive to buy if you're not a resident?
Liz: Many countries want to encourage overseas investment so they don't put up taxes to penalise these buyers. However second home owners, i.e. non-residents, may be taxed at a slightly higher rate than the locals (in France and Italy for example).
Cara: Do read up on tax regulations and ensure you research the taxes that will apply to you in your new home and in the UK. You may wish to consider getting independent tax advice about the implications of buying property overseas.
Or lots of legal red tape that becomes difficult if you're a foreigner and/or if you don't speak the language?
Liz: Most countries have a certain amount of red tape that will be unfamiliar to those from overseas, and even very complicated for those born and bred there (e.g. Italy!).
Cara: Seek independent legal advice from an appropriately qualified English speaking lawyer who is experienced in property sales. If you choose to work with a British lawyer, check that they are qualified to practice both in the UK and overseas, registered with the Law Society in the UK, and have experience in your chosen country.
The FCO cannot interfere in overseas legal proceedings or act on your behalf if you become involved in a property or land dispute.
Are there any distinct pros to owning vs just renting a holiday home abroad?
Liz: The main one is obviously the fact you can profit from capital appreciation. You can also rent it out when you are not using it to help cover its costs, or even make an extra income.
The other is - again, as with the UK - you can customise and extend the property as you wish.
Cara: Although there are positives to owning a house, we would always encourage anyone thinking about moving abroad to research the destination fully and not rush the process - for example, do you know what the place is like at different times of the year?
Sometimes locations that you have holidayed in during the warm months may not be as appealing during winter. Take time to ensure you are making an informed choice. Many people have found renting in the area first is a good way to test the waters.
Can you rent it out to others on Air BnB when not there?
Liz: You can rent it out in most places. However, buyers should be aware that authorities are beginning to clamp down in certain locations such as Paris and Barcelona.
Some locations (or even specific communities, such as in Spain or the USA) might not allow short-term (holiday rentals) too - so you should check this before you buy.
The advantages/disadvantages of buying a house/property somewhere vs a holiday schemes where they manage it all for you.
Liz: For buyers who reside in a different country, investing in a managed resort can have distinct advantages, such as the upkeep and security, which will be taken care of.
Managed resorts frequently offer shared facilities (pool, spa, sports etc) that are a big attraction for rentals, and such resorts will often offer a rentals management scheme too.
However, the downside of such resorts is that you will usually have less privacy, control noise from neighbours, and you will need to pay management fees, whether you use the facilities or not. Resorts may also have restrictions on whether you can have a BBQ, rent out your home, paint the outside etc.
Is there any way to test it out before taking the plunge?
Liz: Yes, you can rent long term. Some companies even offer a "try before you buy" scheme where you can stay in one of their villas before you buy one - sometimes at a preferential rate. It is a good idea to test locations at different times of year if you are thinking of using your home in various seasons.
Cara: Before taking the plunge, we would also recommend that you consider long-term finances, such as your pension, benefits or the effect the exchange rate could have on your salary.
It is also important to consider your healthcare arrangements. You can find out more about how to plan for your healthcare if you are going to live abroad on a permanent basis on the NHS website.
Do think long-term about integrating into the community, including learning the local language if necessary - your life abroad will be more than bricks and mortar!
If you are planning to move abroad, visit (www.gov.uk/browse/abroad/living-abroad) for more information, and if you know the country you would like to move to, check the FCO's Living In guides (www.gov.uk/government/collections/overseas-living-in-guides) for more details.
We also have guidance on buying property abroad - (www.gov.uk/guidance-for-buying-property-abroad).
