Owning a holiday home abroad is an aspiration for many people today who want to have the choice to escape the rat race whenever they want. However, despite these dreams, many people are hesitant to commit to a property abroad as it can indeed be risky. Although arguably it isn’t any riskier than owning property locally and it can, in fact, help you earn some money back.
Read on for a brief overview of what you can expect when buying a holiday home abroad.
Where to buy?
First things first, you will need to decide where you want to buy your property. This will depend entirely on you and your preferences. Do you want to be near a beach or more inland? What is your budget? What climates do you prefer, and do you have any knowledge of the culture or the language? As with the whole process, research is key here. Once you have decided on the location, you need to see what is available. Some areas might have more choices than others; for example, if you were looking for villas for sale in Marbella, you may have more luck than other areas of Spain.
The benefits of buying abroad
Having a holiday home means that you are only ever a flight away from your perfect getaway. You can take a last-minute holiday whenever you want without having to worry about the accommodation. No trawling through websites trying to find an affordable hotel that has space and is conveniently located for your plans. You have a home away from home ready and waiting for you.
You can also make use of your holiday home when you aren’t using it by renting it out for extra income. Most people use their holiday homes for specific dates throughout the year or have it ready for their retirement. Still, a growing number of people are buying them purely to rent them out. You can use a property management agency to take care of the entire process for you when you aren’t there. It is important that you consider how cost-effective renting it out will be. The rental income will need to cover management fees, taxes, bills, and upkeep, as well as making you a profit.
Buying a holiday home will also make you incredibly popular with your family and friends. Some people consider the fact that you can host your loved ones on holiday an advantage. Other people rent out their homes exclusively to friends and family, which can somewhat negate the need for a management company as you are renting your home out to people you trust and already have an established relationship with. Holiday homes can also be great for the whole family as your children age, they can take their friends and family there too.
Buying property will always be a good investment as property only ever increases in value. If the local area you buy in is thriving, then all house prices rise, and you could end up selling the home for a decent profit. Even without an improvement in the area, if you put the time and work into improving the property, the value will rise anyway. This isn’t to say there aren’t any risks in buying property as, on occasion, value can decrease too; however, this does not happen often.
Finally, when buying a home abroad, you will find that the actual price of your holidays is more affordable as the only extra money you need to find is for flights and spending money. If you holiday often or you aim to, then, in the long run, having your own property over there can actually save you money.
The negatives of buying abroad
As with anything in life, there will be drawbacks. Such as the fact that you are limiting your options to a degree. You are committing to the same destination for however long you own the property. This doesn’t bother some people as they love their destination, but others have a desire to explore. Of course, you can go on holiday to other places, but that can be more costly than simply sticking with your holiday home. When looking to buy a home abroad, you should consider whether or not you will get bored with the place, whether it will lose its charm and appeal to you.
Unlike when you stay at a hotel, you will be responsible for any maintenance issues that arise. If you go on holiday for the luxury of not having to lift a finger, then perhaps a holiday home isn’t for you. When on holiday, do you want to be the one responsible for any cleaning needed, household chores or DIY? If this won’t bother you, then it doesn’t really matter. However, there is still the question of taking care of a property that is a plane ride away. While this won’t always be an issue if there is a problem, it may be months before you are even there to notice it, let alone fix it. Although again, some people hire management companies to safeguard their homes and provide them peace of mind.
One pitfall that many people fall into is that they do not consider the other costs of owning a holiday home; they think the price of the property is it. But as in any country, there are other fees associated with owning a property, such as taxes, bills, furnishing, and maintenance fees. This is definitely something that needs to be considered when deciding on a budget for your holiday home. Another monetary consideration that some people do not make is the exchange rate. Buying a holiday home abroad means buying and spending money in another currency. If you prefer to deal in cash, you will need to make sure you exchange your money or if you want to use direct debits, then be wary of the fact that your bank may charge you to convert the money. More than this, exchange rates fluctuate and are totally out of anyone’s control.
There are also legal factors to contend with when buying a property in another country. Each country has its own laws, taxes and regulations that will need following. If you do not follow these, the consequences could be costly in more ways than one. To avoid this, it is advisable that you do your research to learn about any things you need to know about the legality of buying a property abroad.
In conclusion
There are numerous things that you need to consider before committing to buying a holiday home abroad. First, as stated above, it is vital that you do your research and crunch the numbers. For some people, they find it helpful to consult a financial advisor to help them decide whether or not it is truly a viable option for them. The internet can be a great help for you when compiling resources; you can look up the companies and what you can expect from the local area. You can also read up on other peoples experiences of homeownership abroad. Finally, if you do take the plunge, you may find it is the best thing you’ve ever done.