Millions of people own a holiday home abroad, enjoying all the benefits it brings. But, equally abundant are the horror stories of property owners whose dreams in the sun turned into nightmares when things went wrong. So, is it worth it?
A place in the sun
It’s utterly appealing. A holiday home abroad can be a great investment; a place to escape to with your family and friends. But the reality can be somewhat different. Unfavourable exchange rate fluctuations, inability to obtain sufficient income to pay the mortgage costs, rising maintenance costs, utility bills and taxes can turn what should be a financial haven into a financial burden.
But, it’s not all doom and gloom. Often, problems occur because property owners don’t do their research before starting out. It’s easy to put on your rose-tinted glasses when the sun is shining and the cocktails are flowing, but caution and sensible advice can help a potential buyer avoid many pitfalls.
Research, research, research
It’s paramount that you do your homework. Know what type of property you want to buy and where. But remember, if you want to rent it out or resell it in the future, it’s got to be appealing. Is it located in a favourable tourist destination? Is it close to local amenities, shops, bars, restaurants, and good transport links? These are things that tourists and future potential buyers are all going to want.
How much money have you got to spend? Factor in for unexpected expenses such as necessary building work, repairs, and maintenance. Get a good lawyer who understands the local laws and can advise you on all the associated expenses involved in the transaction: taxes, insurance, ongoing costs, and so on.
Check the title deeds of the property to ensure that the seller doesn’t leave any debts on the property that you might inherit. Many of the laws governing the buying and selling of property abroad can be full of holes, allowing unscrupulous sellers, agents and developers to exploit a foreign buyer’s ignorance. So, it’s vital to brush up on your local laws.
Consider what type of property appeals to you. Many people have been lured by the appeal of turning a ramshackle building into a rustic holiday home, without fully realising the extent of the costs and the building work involved to transform it into a let-able state with all facilities and mod-cons. Speak to a local, reputable builder if this is the kind of thing you are after and really do get a full indication of what’s involved.
Get a letting agent
Whilst it’s going to cost you to hire the services of a local letting agency, it makes sense if you’re planning on letting your property out and won’t be residing in it for most of the year. The local agent can manage your property, iron out any issues with tenants, organise repairs and necessary building work, and market your property. Their local knowledge and language skills can help avoid any pitfalls that might occur.