What to Consider When Purchasing a Vacation Home Overseas
When you are considering purchasing a second home, or a vacation home, overseas, there are many factors to consider. Whether you have a country in mind or starting from scratch, it is best to consider the financial and investment side before looking into real estate into beautiful homes in France or Italy. Go through the following on your to-do list before you make your final decision.
Consider the economic situation of the country that you are considering, as well as your own situation. Housing markets tend to go up and down through the years, and so you may need to do some research before choosing a home in a specific market. Ask local experts at which point the market is currently in and which direction it could potentially be moving given current trends. As well, consider the cost of living in that country. When you look through the beautiful homes at Spot Blue International Property Lisbon, consider maintenance and living costs of home upkeep. Especially if you stay in the home for weeks or months, food, medical care, and transportation need to be considered.
What does the current supply and demand look like in the market? If the market is expanding, it takes supply time to catch up with demand. This could create a peak in pricing, and you may consider waiting for another time to purchase a home in this area. And, when you do see a great deal and want to snag it up, you have to go through potentially sticky foreign ownership laws. On an individual basis, countries can place restrictions on non-citizens so they cannot own a property. Even if you can own a property, you may need a special residence permit to do so. Look into the country’s laws and make sure that you can purchase a home, and if you can, what the process is before purchasing can occur.
As you research non-resident permits, consider their tax rules as well. You may be a tax liability when purchasing a home in a foreign country because you pay taxes upon buying and selling your home even in the United States. So, when you want to buy a home overseas, familiarize yourself with their tax laws as they pertain to homes and whether you will need to make payments throughout the year - a common practice.
More than taxes throughout the year and housing costs, buying a second home also comes with a range of carrying costs. You may need to hire a caretaker for maintenance to manage the home while you aren’t staying in it. There may be property taxes, capital gains taxes, and local taxes that you must pay to the local government to keep up a vacation home in a foreign country. There may also be rental management, property management, or homeowner’s association fees pertaining to your situation.
As you consider the many factors that go into purchasing a home in a foreign country, it can be challenging. However, once you’ve done your research and decide you want to vacation in a beautiful flat in Lisbon, you can move forward to finding your second home.