As a UK national, you have the right to live in any European Economic Area (EEA) country, but you may have to apply for residency if you wish to stay. If you intend to move to any other country, you should speak first to the British Consul in that country and its foreign consulate here in the UK.
NAEA, the National Association of Estate Agents calculates that the number of Britons owning a property abroad has increased dramatically in the last few years. It says our favourite places to buy in are Spain, with 27 per cent of purchases and France, with 20 per cent, followed closely by Florida, Portugal and Italy.
Finding a property abroad
For a start you can’t do much worse than look on the internet, there are hundreds of sites devoted to buying property abroad.
You might want to make sure you only use agents that are officially registered and hold the appropriate licence. There are over 700 NAEA estate agents in the UK and abroad who specialise in international sales and will be able to direct you in the right way to go about buying a property abroad, advice on possible pitfalls, and help you locate a suitable property. A NAEA member estate agent will work with other agents and developers who they have investigated to ensure that they are working to ethical standards.
Property laws in other countries are many and hugely varied. Think seriously about speaking to a solicitor with both the relevant country and language expertise.
For instance, foreigners in Turkey are not allowed to buy property in rural areas and those in Australia are only allowed to buy new-builds. And when buying in Spain and some other countries, make sure you are not inheriting any debts associated with the property.
However, at least in the EU, we Britons, as members, are subject to the same laws as residents. However, it’s still an equally pernickety minefield of bureaucracy as we find here.
If you intend to move to any country outside the EU, you should garner some area-specific advice from the foreign consulate in the UK.
So, it is essential to seek advice from the experts, and there are shelves and shelves more detail in the many books specialising on each and every country and all aspects of foreign property.
Your estate agent or vendor should be able to tell you if there are any costs charged by the legal and government authorities for purchasing a property in your chosen country.
If you are going to start a new business abroad, it is not all that straightforward to get a mortgage. You can’t use a British lender, as they only lend on properties in the UK.
However, many British lenders have subsidiaries overseas: Halifax, for example, owns Banco Halifax Espania (www.halifax.es), with nine branches across Spain, with English speaking staff; Norwich & Peterborough Building Society has lending capabilities in Gibraltar and southern Spain; and Barclays has operations in France, Spain and Portugal; and HSBC, Lloyds TSB, Royal Bank of Scotland, Woolwich, and Leeds building societies all provide loans through their international divisions.
Otherwise, you could use a local lender.
Repayments will fluctuate according to changes in exchange rates, so you need to be prepared for that. Overseas lenders generally require a big deposit – between 15 and 25 per cent – but in some countries being a resident means that you can borrow more. As regards repayments, a calculation of how much you can afford to repay is generally used instead of a multiple of your income. In most countries, this would be between 30 and 40 per cent of your income after tax.
You might think about re-mortgaging your current home in the currency of the country into which you are buying.