Overseas Real Estate - Emerging Real Estate

The purchasing process overseas real estate varies from country to country and the following information will assist your purchase.

Step 1
Finding a good overseas real estate agent.

It is important to find an real estate agent who will note your areas of interest, your budget and requirements for overseas real estate and who then takes the time to showcase overseas properties that fit these requests.

A good overseas real estate agent should be able to introduce new overseas properties or properties that may have been otherwise overlooked. Advice should be given detailing the buying process and any extra fees payable as well as legal and financial professional referrals to assist with contracts.

Step 2
View overseas properties with an open mind

Do not be seduced by the sun, the view or the price of overseas real estate. Think about the practicalities of living overseas all year round. For example, make sure central heating is installed as winters may be cold.

Ask about the estate. Does anyone else have access to your land, are there ever any utility shortages? If buying off plan is there a contingency/ backup plan if the development is not finished on time?

Once the right investment opportunity has been found, speak to the neighbours and other expatriates in the local vicinity to get a real feeling for the local purchase process, culture and local area etc.

Step 3
Agreeing a price

Agreeing the price on overseas real estate is one of the most important steps in the buying process. In some countries it is worth trying to negotiate on the price as long as it is not a practise that is illegal or frowned upon

Step 4
Signing a preliminary contract & deposits

Before signing for the overseas real estate and before any money is handed over, it is advisable to appoint a local solicitor. A local solicitor will have local knowledge and understand the country’s legal system with regard to land acquisition and how it applies to non nationals opinion and should be able prevent the purchasing of real estate that is not for sale or from someone who does not have the right to sell it.

The British consulate in the country of the overseas real estate will have a contact list of solicitors and lawyers or alternatively take the recommendation of the overseas real estate agent. If you take their recommendation make sure there is no conflict of interest.

Once a price for the overseas real estate has been agreed, some form of preliminary contract is usually signed. This effectively reserves the overseas real estate and takes it off the open market. Make sure you understand what you are signing and that you agree to all the conditions therein.

A deposit will usually be required at this point to secure the overseas real estate. If there are certain contractual conditions, the deposit should not be paid directly to the vendor as it may be hard to recover it in the event that those conditions are not met.

Step 5
Preliminary Contract to Completion

Between the signing of a preliminary contract and completion a number of things can happen to affect the buying process. For example the results of surveys and applying for the right to buy in the country of the overseas real estate, putting together the finance and obtaining the right permissions.

The initial contract may have a set completion date, especially if a resale or completed overseas real estate is being bought, all searches, surveys and architect reports need to be in place and the finance agreement finalised before this date is reached.

Step 6
Completion

Upon completion, the vendor and purchaser of the overseas real estate will be required to sign some form of contract in front of a lawyer or notary. This hands ownership over to the purchaser - or his mortgage company. Deeds will be transferred for the real estate and the final balance will be due.

If ‘off plan’ overseas real estate or a completed new property is being bought, it can be advantageous to find out if deferment of a percentage of the money is possible until you are completely satisfied with the build quality and finish of your overseas real estate. In some countries the withholding of this amount is standard practice, in other countries it is not. Sometimes the solicitor can withhold money as an independent intermediary. It is worthwhile asking for this deferment as it can be a good negotiating tool if something is not working properly.

This guide is not exhaustive. It is imperative to seek professional legal, financial and tax advice at every step of the way, to stay informed and not to be seduced by the sunshine.