3 Sobering thoughts for soon-to-be investors

September 1, 2017

As the holiday season draws to a close and many holidaymakers return home, some may still hanker after far-away places, with their minds shifting from holiday-making to investment-making.

So if you are one of those soon-to-be investors, here’s a thing or two to mull over.

Not a cash-buyer and seeking a mortgage?

Investors seeking a mortgage overseas may not realise that they are not likely to get the same interest-only mortgage options abroad as they do in their home European Investment apartmentscountry, or the interest-only element is limited to the first year or two only. What’s more, there may be less mortgage flexibility, so as a borrower you ought to make sure you are happy with the mortgage you are offered at the outset, otherwise it might be costly to change it further down the line.

Most banks will treat a foreign national as a higher risk and so tend to offer a lower loan-to-value, or in other words, it may mean you need a slightly bigger deposit as down payment compared with a local buyer.

Avoid a common misconception among international property buyers

It might be stating the obvious, but some investors and home buyers don’t necessarily think through the fact that buying and renting laws are different between countries in Continental Europe and in the UK. So in some countries, or some cities, the scope for renting a home out is more restricted than others, especially in this Airbnb era. What’s more buy-to-let tenants elsewhere may have greater levels of protection than you are used to, so it ‘pays’ to set up your rental agreement correctly in the first place.

Thinking of cutting corners? What common problems might you face?

Often buyers try to keep costs down by not using a lawyer and think they are covered because a Notary is involved in the process. However a Notary represents a buyer at the point of purchase to ensure you fully understand what you are buying, but a Notary does not help with the drafting of the purchasing contract, or checking everything is set up properly prior to the point of purchase.

Time spent up front will be more than rewarded later down the track, when it might get more tricky to unwind a bad decision.

If you want help and support through the buying process then please get in contact

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Property Venture® is an award-winning, European Investment property company who helps investors enrich their lives buying property in Europe.

The focus is mainly greater Europe: UK investment property, Managed Property in France, German property investment, buy-to-let and homes in Poland, Spanish city and Costa property.

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