Buying a house abroad?
Discussion
I know many on here has considered or indeed have done this - some great threads!
I’m currently late 30s and I’m considering where I want to end up, and so am looking into the possibility of buying a house abroad, initially as a holiday home, and then perhaps to become something more permanent. Just trying to assess realism / practicality of setting it as an aim at the moment.
I’ve been looking at Italy as it tends to be my favourite European country, although not 100% wedded to this as unfortunately due to Brexit I suspect visas could be an issue.
I’m seeing plenty of places on Rightmove overseas which windowshopping for £125k which seem to be incredible VFM. I’m very handy and do alot of work on my current place in the UK myself, as some of my threads will attest to, although got to be realistic while I’m still working I can’t take 3 months off so easily to “pop round” and do a bunch of jobs.
Any factors I should consider and that I might need to have a long term plan for? What are the downsides I’m not seeing? On the flip side, what are the positives which you have most appreciated if you’ve done it, or that you’re looking forward to?
Hopefully an engaging discussion, just for fun now, but maybe not forever!
I’m currently late 30s and I’m considering where I want to end up, and so am looking into the possibility of buying a house abroad, initially as a holiday home, and then perhaps to become something more permanent. Just trying to assess realism / practicality of setting it as an aim at the moment.
I’ve been looking at Italy as it tends to be my favourite European country, although not 100% wedded to this as unfortunately due to Brexit I suspect visas could be an issue.
I’m seeing plenty of places on Rightmove overseas which windowshopping for £125k which seem to be incredible VFM. I’m very handy and do alot of work on my current place in the UK myself, as some of my threads will attest to, although got to be realistic while I’m still working I can’t take 3 months off so easily to “pop round” and do a bunch of jobs.
Any factors I should consider and that I might need to have a long term plan for? What are the downsides I’m not seeing? On the flip side, what are the positives which you have most appreciated if you’ve done it, or that you’re looking forward to?
Hopefully an engaging discussion, just for fun now, but maybe not forever!
I will kick off as we have had a house in Umbria for the last 15 years.
Things to consider.
The buying process is different but usually more secure. Do some research of the offer/payment process and pre-emption rights etc.
Cheaper properties are usually in a poor state or area.
What are you using the property for and will it deliver for you - we bought 2 properties thinking we would rent one and then decided we didn't want to and joined the properties together - now too large really but great location.
You will need to learn the language if you want to engage with the locals and be part of the community.
Consider the location and transport - can you get flights or will you drive. We regularly drive but can also always get flights to Rome/Pisa.
Who will look after the property when you are not there. The Italian services are not as reliable as our and issues will happen.
There are similar costs to the UK such as council tax (EMU) and other taxes for services etc.
It could restrict other holiday locations as you feel you need to use it when you can - we are now retired so don't have that issue with just annual holidays.
You can spend up to 6 months there or even apply for residency - it's not a major issue.
The Euro rate can change quickly - we bought the house when the rate was €1.60 to £1. It has almost dropped to parity since!! You also need a source of Euros to use and maintain the property.
I am sure there are load more but there are also a load of benefits - we have made some great Italian friends along the way and some of our UK friends have enjoyed some fantastic Italian holidays!!
Things to consider.
The buying process is different but usually more secure. Do some research of the offer/payment process and pre-emption rights etc.
Cheaper properties are usually in a poor state or area.
What are you using the property for and will it deliver for you - we bought 2 properties thinking we would rent one and then decided we didn't want to and joined the properties together - now too large really but great location.
You will need to learn the language if you want to engage with the locals and be part of the community.
Consider the location and transport - can you get flights or will you drive. We regularly drive but can also always get flights to Rome/Pisa.
Who will look after the property when you are not there. The Italian services are not as reliable as our and issues will happen.
There are similar costs to the UK such as council tax (EMU) and other taxes for services etc.
It could restrict other holiday locations as you feel you need to use it when you can - we are now retired so don't have that issue with just annual holidays.
You can spend up to 6 months there or even apply for residency - it's not a major issue.
The Euro rate can change quickly - we bought the house when the rate was €1.60 to £1. It has almost dropped to parity since!! You also need a source of Euros to use and maintain the property.
I am sure there are load more but there are also a load of benefits - we have made some great Italian friends along the way and some of our UK friends have enjoyed some fantastic Italian holidays!!
Been there and considered it myself and have family members who have moved to the continent to live full time.
I guess this extend to anywhere you have a holiday home with a long term eye on eventually moving to.
Maintenance if you're not there for extended periods ongoing maintenance and up keep can be time consuming and expensive-somewhat mitigated if you do a decent job of an initial renovation.
Purchase/ongoing costs-not sure about Italy in terms of additional taxes etc but naturally worth factoring these in, in addition to the purchase price. Also factor in other taxes, utility bills etc. Not sure about Italy specifically.
Property value fluctuations. If for any reason you need to sell up due to a change in circumstances etc I know many a seller who bought at the peak in Spain and have had to sell at a huge loss. You might not care so long as it's paid for by time you want to use it full time-would you need a mortgage? Interest rates have increased on the continent lately.
Limited use-you've got all the above costs for something you can use for 4-6 weeks of the year, would/could you rent it out-that would add extra cost and hassle. Post brexit it's more of a hassle for those that want to use a place abroad but not take resident status. Spain is currently a maximum of 90 days in a 6 month period and no more than 180 in a 12 month period. I know people have done more and got away with it but there's always a chance of a 2.5K Euro fine if you get caught.
With two young kids I really liked the idea of having a place to use as a holiday home, I get a lot of annual leave and having somewhere to use for the school holidays for over a decade until the kids are of an age they're no longer interested in going on holiday with their parents by which time I'd be nearing retirement age. But the sums just didn't work when compared to the flexibility of holidaying where we want without any of the agro.
I guess this extend to anywhere you have a holiday home with a long term eye on eventually moving to.
Maintenance if you're not there for extended periods ongoing maintenance and up keep can be time consuming and expensive-somewhat mitigated if you do a decent job of an initial renovation.
Purchase/ongoing costs-not sure about Italy in terms of additional taxes etc but naturally worth factoring these in, in addition to the purchase price. Also factor in other taxes, utility bills etc. Not sure about Italy specifically.
Property value fluctuations. If for any reason you need to sell up due to a change in circumstances etc I know many a seller who bought at the peak in Spain and have had to sell at a huge loss. You might not care so long as it's paid for by time you want to use it full time-would you need a mortgage? Interest rates have increased on the continent lately.
Limited use-you've got all the above costs for something you can use for 4-6 weeks of the year, would/could you rent it out-that would add extra cost and hassle. Post brexit it's more of a hassle for those that want to use a place abroad but not take resident status. Spain is currently a maximum of 90 days in a 6 month period and no more than 180 in a 12 month period. I know people have done more and got away with it but there's always a chance of a 2.5K Euro fine if you get caught.
With two young kids I really liked the idea of having a place to use as a holiday home, I get a lot of annual leave and having somewhere to use for the school holidays for over a decade until the kids are of an age they're no longer interested in going on holiday with their parents by which time I'd be nearing retirement age. But the sums just didn't work when compared to the flexibility of holidaying where we want without any of the agro.
Wherever you decide my two top tips are , learn the language as best you can and never ever when viewing a property stand back in the sunshine and say “ think what this would be worth in England “
It’s very easy to be seduced by seemingly cheap property , it’s never cheap , it’s always market value .
Another thing that’s an eye opener sometimes is to visit in the winter months , that bustling market town in wherever can be a ghost town in the winter .
That said , it is nice to kick back in the summer and have your own place with a pool and lots of space , just go in with your eyes wide open .
I’ve had 2 over the years and sold them both .
It’s very easy to be seduced by seemingly cheap property , it’s never cheap , it’s always market value .
Another thing that’s an eye opener sometimes is to visit in the winter months , that bustling market town in wherever can be a ghost town in the winter .
That said , it is nice to kick back in the summer and have your own place with a pool and lots of space , just go in with your eyes wide open .
I’ve had 2 over the years and sold them both .
Edited by paulwirral on Monday 20th March 09:46
Some great tips here. Would actively want to learn the language, it’s on my bucket list, so totally agree there.
I agree / have concerns regarding maintenance costs, would need to look into that. Can be handy as you like but if I’m all the way back in the UK it’s a fat lot of good (hard enough finding reliable traders here, let alone through a language barrier!)
Hasn’t thought of the buy two rent one out scenario. That’s atleast worth thinking considering as part of the long term plan (although I note you decided not to - any particular reason why?)
I agree / have concerns regarding maintenance costs, would need to look into that. Can be handy as you like but if I’m all the way back in the UK it’s a fat lot of good (hard enough finding reliable traders here, let alone through a language barrier!)
Hasn’t thought of the buy two rent one out scenario. That’s atleast worth thinking considering as part of the long term plan (although I note you decided not to - any particular reason why?)
Had a holiday home in Mallorca for 12 years and wouldn't do it again while working full time. Put simply you just don't have enough time to do the maintenance and enjoy it. We did some work on ours, new flooring and kitchen and it was an apartment in a reasonably modern building (so straightforward, not a 120 year old wreck). It took so much time and you are always under time pressure e.g. finish kitchen install at 11am having spent a week on it, flight home at 5pm, work at 9am the next morning!
Language is key. When you are on holiday everyone speaks english, but go to a diy store or more likely the local hardware store in a small town and nobody does. Even if you are learning the language you will struggle to explain what you are trying to buy when you don't even know what the english word is! Learning the language to get by in shops and restaurants and to speak to your neighbours is different to being able to go to the local builders merchant and make yourself understood.
My advice would be to wait until you can spend the time on it. A holiday where you spend 90% of your time fixing things or shopping for household items is no holiday!
If you do go ahead make sure you find someone local who can go and air the property, check the water etc especially in winter. Good luck
Language is key. When you are on holiday everyone speaks english, but go to a diy store or more likely the local hardware store in a small town and nobody does. Even if you are learning the language you will struggle to explain what you are trying to buy when you don't even know what the english word is! Learning the language to get by in shops and restaurants and to speak to your neighbours is different to being able to go to the local builders merchant and make yourself understood.
My advice would be to wait until you can spend the time on it. A holiday where you spend 90% of your time fixing things or shopping for household items is no holiday!
If you do go ahead make sure you find someone local who can go and air the property, check the water etc especially in winter. Good luck
Think about what you will spend to own and renovate and how you will be tied to it, then balance that against having the same amount to spend on luxury holidays. Eg £150K to buy plus legals plus £75K on renovations plus costs of ownership over 20 years averaged at £3K a year pus annual travel costs of £2K a year takes you to around £325K. Or £8K a year in holidays with zero worry and hassle. Yes, you will have an asset if you purchase but you will have to balance that against 'having' to visit your foreign property incessantly or it being pointless. You can rent something on a long let for £6K to £8K that will be streets ahead of anything you can buy for £250K.
...and don't forget you'll need local tax advice in that country. Your foreign holiday home is likely to attract local Capital Gains Tax. Many countries use a "witholding tax" system where the seller's lawyer deducts a percentage from the proceeds of sale and sends it to the tax authorities. Note: a percentage of the selling price, not a percentage of your gain. It's then up to you to try to explain your actual gain to the tax authorities and claim any tax refund.
If you rent the place out you're also likely to become liable for local income tax.
And then there's the question of claiming "double taxation relief" in UK. i.e. asking HMRC to give you a UK tax credit for the tax you've paid overseas.
If you rent the place out you're also likely to become liable for local income tax.
And then there's the question of claiming "double taxation relief" in UK. i.e. asking HMRC to give you a UK tax credit for the tax you've paid overseas.
Pheo said:
Some great tips here. Would actively want to learn the language, it’s on my bucket list, so totally agree there.
I agree / have concerns regarding maintenance costs, would need to look into that. Can be handy as you like but if I’m all the way back in the UK it’s a fat lot of good (hard enough finding reliable traders here, let alone through a language barrier!)
Hasn’t thought of the buy two rent one out scenario. That’s atleast worth thinking considering as part of the long term plan (although I note you decided not to - any particular reason why?)
I’m guessing the last part is a question to me ? I agree / have concerns regarding maintenance costs, would need to look into that. Can be handy as you like but if I’m all the way back in the UK it’s a fat lot of good (hard enough finding reliable traders here, let alone through a language barrier!)
Hasn’t thought of the buy two rent one out scenario. That’s atleast worth thinking considering as part of the long term plan (although I note you decided not to - any particular reason why?)
Long story but I bought 1 house to improve, perfectly nice 2 bed detached bungalow and a building plot next door in France .
We did the first house and tried the whole “ living in the sun “ bit but it was a waste of my wife’s education and also we found it didn’t really suit us , we’re townies to be honest and we prefer the town lifestyle , so we sold but kept the building plot for the future.
The future arrived a few years later and I went back and built another bungalow for a holiday house . We used it as much as we could but ultimately got bored , we started taking holidays from our holiday house ! So when the opportunity arose for an easy sale we took it .
If you search “ French self build “ on here you should find a build thread with all the details. Sorry I don’t know how to post a link as I’m better with manual tools than tech !
As has been said already , better off renting other peoples to be honest , that’s what we do now .
If you really want to try it rent someone else’s house in your chosen area for up to 6 months , I’m not meaning go there and live in it for the duration , just try and visit it as many times as you can in that time . You’d be looking at out of season but you’ll get a better feel for what it involves . And if renting and not using it sounds like a waste of money , think about if you owned it .
We never needed to rent ours out to contribute to the running costs but our reality was I’d spend 10 weeks a year there and my wife half that , and I’d lock it up end of September and not go back until March at the earliest the following year .
goingonholiday said:
If you do go ahead make sure you find someone local who can go and air the property, check the water etc especially in winter. Good luck
This might sounds trivial but it's a real thing if it's going to sit unoccupied for months on end. We used a family members place last October which had only been unoccupied for 2 months. Windows behind security shutters are left ajar to let the air circulate but the the place was think with dust and all the bedding etc needed changed and washed-not the best when we arrived at 2300hrs with tired kids. You can prepare better for this as ours was last minute trip, but what you don't want if you're getting away for a week to have to do a load of cleaning and washing-you can do that at home 
We have a villa in Greece, which we rent out. Even in a busy season it just washes its face once all taxes, accountants fees, turnaround costs, inventory upgrades each season, utility bills (electricity with a pool and aircon is insane!).
Family use the villa about 4 weeks a year in reality. Capital gain over 15 years has been negligible. Stress has been quite high at times. Have we considered selling? Yes, pretty much every year :-)
Would we live there? No, I don't think so. And I don't want to become a Greek resident so you need to be careful of your timings (post Brexit). When I arrive, I have to spend a day at the town hall and tax office paying water bills and keeping my paperwork up to date.
It is a hassle, albeit a lovely place in a beautiful spot.
The idea is very appealing. The reality is not quite so. If I was wealthy I wouldn't bother renting it out, but we need to for financial reasons, because I estimate it would cost around £10k a year in normal running costs if not rented out.
Family use the villa about 4 weeks a year in reality. Capital gain over 15 years has been negligible. Stress has been quite high at times. Have we considered selling? Yes, pretty much every year :-)
Would we live there? No, I don't think so. And I don't want to become a Greek resident so you need to be careful of your timings (post Brexit). When I arrive, I have to spend a day at the town hall and tax office paying water bills and keeping my paperwork up to date.
It is a hassle, albeit a lovely place in a beautiful spot.
The idea is very appealing. The reality is not quite so. If I was wealthy I wouldn't bother renting it out, but we need to for financial reasons, because I estimate it would cost around £10k a year in normal running costs if not rented out.
My better half’s parents had one for 20 years.
For us it was great and they had lots of holidays with the grandchildren. They made friends, particularly expats and had a good time with it. In early retirement they went for 10 weeks at a time.
As a downside, they only went on holiday for 20 years there, we’re always doing bits of maintenance and had periodic dramas went things went wrong whilst they were back in the uk.
For me the property ended up owning them and I wouldn’t want to feel restricted to the place unless it was sufficiently close I could go on a whim for the weekend. In their case it was 8 hours drive from the ferry.
My approach is to invest the money elsewhere and use that to fund the holidays.
For us it was great and they had lots of holidays with the grandchildren. They made friends, particularly expats and had a good time with it. In early retirement they went for 10 weeks at a time.
As a downside, they only went on holiday for 20 years there, we’re always doing bits of maintenance and had periodic dramas went things went wrong whilst they were back in the uk.
For me the property ended up owning them and I wouldn’t want to feel restricted to the place unless it was sufficiently close I could go on a whim for the weekend. In their case it was 8 hours drive from the ferry.
My approach is to invest the money elsewhere and use that to fund the holidays.
We are clinging to the dream of retiring to Italy in about 10 years.....but there's quite a few variables that will impact on that.
The initial idea was to sell up, cash in all our chips and buy something over there, we've now changed that to renting, no idea on how feasible that is, we're nowhere near even narrowing down to a region yet. But interested in reading about how others have done it.
The initial idea was to sell up, cash in all our chips and buy something over there, we've now changed that to renting, no idea on how feasible that is, we're nowhere near even narrowing down to a region yet. But interested in reading about how others have done it.
I've had a ski apartment for the last 15 or so years. It has it's pros and cons.
The biggest challenge I've always had was finding honest reliable local people to deal with things when you're not there, especially if you'll be renting.
But being able to ski for the cost of a lift pass and beer money whenever takes my fancy is quite appealing, especially when you speak to others and find out what they've paid for a week on the slopes.
I'm not sure I'd consider a summer property unless I envisaged being able to use it for a significant portion of the year.
I'd certainly visit the area you plan to buy several times in different seasons to see what it's like. For example most people I know in resort don't use their apartment in February as it gets incredibly busy during the school holiday period.
The biggest challenge I've always had was finding honest reliable local people to deal with things when you're not there, especially if you'll be renting.
But being able to ski for the cost of a lift pass and beer money whenever takes my fancy is quite appealing, especially when you speak to others and find out what they've paid for a week on the slopes.
I'm not sure I'd consider a summer property unless I envisaged being able to use it for a significant portion of the year.
I'd certainly visit the area you plan to buy several times in different seasons to see what it's like. For example most people I know in resort don't use their apartment in February as it gets incredibly busy during the school holiday period.
I’ve owned in Italy. Agree on language but even then you can find it difficult with the technicalities of building materials and tradespeople
Cash can be an element of property transactions in Italy something to do with locals avoiding tax so be careful.
Kitchens sometimes get removed and taken from property to property so be clear on what you are buying
Parts of Italy have two versions of electricity. The lower cost you can only draw a small amount of kw at any time otherwise it trips !
Good luck
Cash can be an element of property transactions in Italy something to do with locals avoiding tax so be careful.
Kitchens sometimes get removed and taken from property to property so be clear on what you are buying
Parts of Italy have two versions of electricity. The lower cost you can only draw a small amount of kw at any time otherwise it trips !
Good luck
Visa, visa, visa. That's the trickiest part.
I was set on Italy, used to live there, but I can't get a visa as I have no passive income (pension/shares etc).
Greece is the current contender for us.
With Italy you really do want to work on your language - it goes a long way. They have two types of money. Money, and black money. The latter being cash/tax avoiding. It is part of the culture. I even had a dentist ask me, "invoice?, or?" I paid cash and saved about 100 euros lol.
I was set on Italy, used to live there, but I can't get a visa as I have no passive income (pension/shares etc).
Greece is the current contender for us.
With Italy you really do want to work on your language - it goes a long way. They have two types of money. Money, and black money. The latter being cash/tax avoiding. It is part of the culture. I even had a dentist ask me, "invoice?, or?" I paid cash and saved about 100 euros lol.
We live in italy full time, and have done now for 4 years. We moved out with no idea about anything, and not a single phrase of the language. We're getting there, but Italian doesn't come naturally to me, and i struggle to 'hear' it. That said, it hasn't really held us back, just makes me aware that i couldn't get into a deeper conversation.... We settled on a very rural part of Tuscany, and we love it, though even in our short time we've seen folks come, try it, and leave. My personal feeling, is you need to commit and go for it. Had we kept a place in the uk (not financially possible) I think when the going got tough, we may well have been drawn back.
I've set myself up as a gardener/handyman out here, and i'm a fairly practical chap.One thing people seem to overlook or become seduced by is having more as prices are favourable. Ask yourself, who will cut my grass, can i afford someone to look after my pool. who will check on the place or pop on the heating/stack my wood in my absence. I see a lot of ragged looking places that i assume people bought because cheap, and never considered the running costs. As much as it isn't my thing, i now see the attraction of a lock and leave place.
I've set myself up as a gardener/handyman out here, and i'm a fairly practical chap.One thing people seem to overlook or become seduced by is having more as prices are favourable. Ask yourself, who will cut my grass, can i afford someone to look after my pool. who will check on the place or pop on the heating/stack my wood in my absence. I see a lot of ragged looking places that i assume people bought because cheap, and never considered the running costs. As much as it isn't my thing, i now see the attraction of a lock and leave place.
Craig - when i was there, 12 years ago, the gov sponsored night school. I did one night a week. 35 euros for a whole year.
I spent lots of time with Rosetta Stone app and a headset, which was great, but nothing helped as much as night school. Conversations with my Italian friends taught some vocab, but nothing was as helpful as being taught at "school".
I spent lots of time with Rosetta Stone app and a headset, which was great, but nothing helped as much as night school. Conversations with my Italian friends taught some vocab, but nothing was as helpful as being taught at "school".
Some interesting follow ups thanks. Fair points about usage; we have access to a holiday cottage owned by the family just outside woolacombe and struggle to get down there so it’s a very valid point.
I don’t think I would be wanting to buy a holiday home for only that reason - my thought was to transition to living there for significant chunks of time; not just a couple of weeks a year as I agree, waste of time. The idea being transitioning to living out there more permanently.
Sounds like Italy might not be the best place from a visa perspective. Also sounds like I really should not buy a wreck! Unless living there full time I guess you need a very different property.
Some great input here though thanks all. I will add this was more me asking to assess practicality / shape a possible plan - I don’t have the funds to run off and buy something right now, so was more about if setting this as a life goal is a good idea.
I don’t think I would be wanting to buy a holiday home for only that reason - my thought was to transition to living there for significant chunks of time; not just a couple of weeks a year as I agree, waste of time. The idea being transitioning to living out there more permanently.
Sounds like Italy might not be the best place from a visa perspective. Also sounds like I really should not buy a wreck! Unless living there full time I guess you need a very different property.
Some great input here though thanks all. I will add this was more me asking to assess practicality / shape a possible plan - I don’t have the funds to run off and buy something right now, so was more about if setting this as a life goal is a good idea.
I have a boat in mallorca and we live on it for 3 or so months a year.
I also rent a villa for a month a year when my kids are there. Villa is nice.
I keep thinking about buying one. In Spain e500k gets you a visa.
However …. Stamp duty ( equiv ) is 10%. Agents fees to sell 5%. So you are 15% down on day 1. That is a lot of rent. You then have running costs that are little different to the U.K. and then to top it all you can’t rent in mallorca and they are not issuing any more licences.
You have assessed tax ( rent it or not ) and as others have said iht / capital gains etc.
The market is also illiquid as it is a holiday island not a place where people live ( other than Palma ). Some areas will have this issue some not but need in mind there add cheap houses in the U.K. and they are cheap as you don’t want to live there. By and large this applies abroad - it is just sunny.
I might do it one day but each time I get close I remember the above.
I also rent a villa for a month a year when my kids are there. Villa is nice.
I keep thinking about buying one. In Spain e500k gets you a visa.
However …. Stamp duty ( equiv ) is 10%. Agents fees to sell 5%. So you are 15% down on day 1. That is a lot of rent. You then have running costs that are little different to the U.K. and then to top it all you can’t rent in mallorca and they are not issuing any more licences.
You have assessed tax ( rent it or not ) and as others have said iht / capital gains etc.
The market is also illiquid as it is a holiday island not a place where people live ( other than Palma ). Some areas will have this issue some not but need in mind there add cheap houses in the U.K. and they are cheap as you don’t want to live there. By and large this applies abroad - it is just sunny.
I might do it one day but each time I get close I remember the above.
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