Are you on the verge of buying a property abroad for the first time and are unsure what to expect? Maybe a little worried? Don’t worry, that’s perfectly normal! To help you prepare, here are five of the most common panics that new buyers encounter at the last minute.
“I expected my search to take longer!”
Many property hunters end up buying a property abroad during their first viewing trip to Spain or Portugal. It even happens in a resort they’re visiting for the first time. Why not? Especially if you have relatively straight-forward requirements such as a holiday pad near the beach.
Love at first sight can be wonderful, but it’s usually best not to make an offer there and then.
Buyers often fall in love with the first property they view too. While love at first sight can be wonderful, it’s usually best not to make an offer there and then. Instead, carry on with the other viewings your agent has arranged for you. Then compare everything you’ve seen, including prices, access, ongoing costs etc. Even if property number one still sets your pulse racing, arrange a second visit anyway. Then see how you feel and make an offer, or not, accordingly.
Ready to buy? For real peace of mind, come and meet Property Guides, trusted estate agents, lawyers and currency specialists at Your Overseas Home. The next show is in Scotland next week. Visit the website for free tickets to this and shows throughout the UK this year.
Buyers actually tend to choose a home overseas much faster than they would at home. After all, when viewing property abroad you will normally have a limited time to see your selection of properties. Much of your sucess will be down to the efficiency of your estate agent. A good agent should only show you properties that match your wish-list and budget. So don’t worry, the first property you visit has as much chance of being your favourite as the last one.
“My estate agent is so helpful it’s almost unsettling!”
It’s quite normal for good estate agents, dealing with British and other foreign clients, to do far more than simply sell you a property. They understand that buying a property in a foreign country can be daunting. After all, it involves a number of unfamiliar procedures and a different language. So if you’ve picked your agent carefully, their willingness to help will be genuine. Compared to estate agents in the UK, they tend to assume a far more involved and extensive role. Then again, they earn a higher commission than most UK estate agents too. As a buyer you will often shoulder the expense, or share it with the seller.
Good agents will not only find you a property. They will usually assist during the buying process right up to completion day at the notary’s office. For example, they might help you open a local bank account in Portugal, or obtain your NIE (tax identification number) in Spain.
Even after the sale, the community of British buyers and owners in Spain or Portugal is often relatively small, so a sensible agent will want to maintain their reputation and contacts. So they will often help with all those other things that come with buying and being a homeowner. They might assist with changing the locks and sorting new burglar alarms, getting connected to the internet, buying furniture, installing air conditioning or recommending a builder…
Most will have a key-holding and property management service too. Certainly in Spain or Portugal you can rest assured that someone will be available to deal with an emergency situation. They may also be able to organise rentals for you, and handle any maintenance issues when you’re not there. Above all, they are also useful sources for information about the local area and who you need to know.
“Granting power of attorney makes me anxious”
Before buying a property abroad, most people have never been confronted with the option of granting power of attorney (POA) to someone. It’s a perfectly common solution for property-buyers who don’t want to – or can’t – make trips back and forth to the continent to complete the purchase of their property. Fear not, you are not signing away your life and worldly assets!
If you are ready to take the next step, you need a good lawyer, a brilliant estate agent, and the best currency exchange company. We can introduce you to all free, with no hassle or sales calls. Get in touch with our Spanish Golden Three here and your Portuguese Golden Three here.
It works by you giving authority to a third party, usually your independent lawyer, to carry out certain defined acts on your behalf. These will typically be anything required to complete the purchase of your property. In Spain it could include obtaining your NIE, opening a bank account, paying bills and taxes. Both the Spanish and Portuguese systems use notaries, and your POA could complete the purchase on your behalf at the notary’s office. All you need to do then is travel to your new home at a time that is convenient to you and pick up the keys. Drawing up a POA document and getting it notarised typically costs €250-€350 in total.
“If the pound weakens, it costs me more!”
Property buyers abroad should need to protect the value of their pounds abroad. Ignoring it, or leaving it too late, could land you a nasty surprise on completion day.
You might even make an offer because the pound is strong and you’re getting more euros that day. That is a huge risk.
Here’s why. Your offer on a Spanish or Portuguese property will be in euros. But in your head you will work out a price in pounds, according to the exchange rate that day. You may even make an offer because the pound is strong and you’re getting more euros that day. That is a huge risk. Because the exchange rate is constanty changing, so does the cost in pounds of your property, even while the agreed euro price remains the same. So you won’t know how much your purchase will cost you until the moment you exchange the required pounds into euros.
Worried about currency? Smart Currency Exchange will be joining Property Guides at Your Overseas Home. The next show is in Scotland next week. Come and visit us to get all your currency questions answered. Alternatively, read Smart’s Property Buyers’ Guide to Currency.
Fortunately, there is an effective way to counter this uncertainty. It’s called a forward contract and it enables you to know the cost of your purchase in pounds and euros the day your offer is accepted. A forward contract fixes your exchange rate for an agreed amount of euros required at a future date, i.e. completion day. Speak to Smart Currency Exchange for more information and for guidance on all currency transfers.
“The purchase seems to be moving unnervingly fast”
Don’t worry, in Spain and most other European countries, if there are no complications, a property transaction can be done and dusted comfortably within two months. Of course, this will depend on both parties being in sync and comfortable with this. It helps that in many cases, vendors are foreign and either selling second homes or moving back to their native country, so are not in a chain. This is also why properties within holiday resorts or in popular expat areas are often sold furnished.
As a key takeaway, the three key requirements for a speedy and successful purchase are a good lawyer, well-organised estate agent and the services of Smart Currency Exchange for your currency transfers.