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How To Buy A Holiday Home Abroad?

Are you a UK national looking to buy a holiday home abroad? This concise yet complete guide will help you find the information you’re looking for.
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About 1.5 million people from the UK own property in another country, whether for holidays or as a permanent place to live.

This could be because properties overseas can sometimes be cheaper than in the UK, and the weather in locations like Spain or France can be a big draw for those looking to enjoy more sunshine.

However, buying property in another country can be a bit more complicated than buying in the UK, so it’s important to do your research and possibly get advice from experts who know about buying property in the country you’re interested in.

You must also understand the risks involved with buying and maintaining a property abroad.

In this guide, we will look at how to buy a holiday home abroad and things you should know. So, let’s dive in without further ado.

Can You Buy A Holiday Home Abroad While Living in The UK?

Yes, if you’re living in the UK, you can still buy a holiday home abroad.

When buying a holiday home abroad, you’ll need to think about a few things like how to get a mortgage for the property, what costs will be involved (like taxes and maintenance), and the benefits of owning property in another country. 

It’s not just about having a nice place to stay; it may also be considered a good investment.

Benefits of Buying A Holiday Home Abroad

Buying a holiday home overseas has multiple benefits. Apart from being a holiday retreat, it can also double as a great investment that you could cash in on later. 

And when you’re not using the property, you might consider renting it out for some extra income.

However, friendly neighbourhoods and local amenities aren’t the only things to consider when buying a property in another country. 

The very first thing you need to do is to compare similar properties in the area to get an idea of the type of property and the associated prices.

This is the primary consideration that needs to shape your decisions. After you’ve decided on the type of property and their prices, you can look into other aspects, such as:

  • Whether the area you’ve chosen is prone to natural disasters or not
  • In case you want to rent your property, you need to understand the rent rates in the locality
  • And, of course, as a foreign buyer, you’ll need to follow the laws of the land

How To Find A Good Holiday Home Overseas

How To Find A Good Holiday Home Overseas

When you’re trying to find a holiday home overseas, the very first thing that might enter your mind is: How can you even find the property to begin with? 

Thankfully, there are a number of resources that you can refer to for this. Some of these are listed below as examples:

1. Property Websites

The most logical resource to turn to for finding property abroad is real-estate websites. Just run a quick Google search with the query of holiday home + location, and you’re sure to get some good references/ideas.

You can also refer to online forums and review sites, where you’ll find the opinions of people who have already invested in foreign property. 

These resources can give you an idea of the properties you might want to look at and their potential prices.

2. Housing Developers

Sometimes, new projects aren’t listed on property websites as they are usually snapped up by local buyers. 

And if the project is by a respectable developer, then there’s all the more chance that it’ll be bought by locals before even landing on property sites.

That’s why it’s best to make a list of developers in the locations where you’re looking for property and connect with them. 

They might have some good options on hand or might even be able to offer land where they can develop the holiday home for you.

3. Local Agents

You can also take the help of local real estate agents to buy property abroad. Local agents will have a good understanding of the markets and will be able to guide you better. 

They can also help with the paperwork and legalities. However, they will charge a fee, so you have to keep that in mind as well. 

Overseas Mortgage for A Holiday Home Abroad

After you’ve settled on a property to buy, you’ll need to apply for an overseas mortgage if required. The type of mortgage you should apply for will depend on how you plan to use your property. 

For example, if you plan to rent your property for the short-term as a holiday home, you’ll need to apply for a holiday-let mortgage.

Holiday Let Mortgages

For longer-term rentals, you might consider buy-to-let mortgages. Keep in mind that you might need to put down a higher deposit when securing an overseas mortgage. 

What is Buy-To-Let Mortgage

Also, since the FCA doesn’t control overseas property transactions, you might want to go with a British-based broker who understands the local market and can reduce risks.

Type Of Costs Associated With Buying A Holiday Home Abroad

The following is a brief list of the various costs associated with buying a holiday home abroad.

  • Mortgaging fees, such as administration, arrangement, and broker charges
  • Fees paid to the surveyor for reviewing the property
  • Fees for international funds transfers
  • Legal fees, such as for property registration, stamp duty, etc.
  • Taxes and tax advisor fees, if applicable
  • Insurance costs

You’ll also need to factor in currency exchange rate fluctuations into the calculations.

The Effects of Brexit

After the UK left the EU, the cost of living in European nations for UK nationals increased, as did the restrictions on how long one could stay there. 

Brits are now restricted to staying around 90 days at a time during a 180-day time period.

The tax rules have changed, too, so that’s another aspect you need to keep in mind.

Frequently Asked Questions (FAQs)

1. What Is The Best Way To Ensure Investment Protection When Buying A Holiday Home Abroad?

To protect your investment, you should always consider buying property insurance with comprehensive coverage to the best of your abiltiy. Also, it’s best to employ reputed property management services to take care of your overseas property. 

In addition, we recommend staying informed and updated about the latest laws and regulations of the country where you’ve bought the property. If possible, try to keep a contingency fund to meet unexpected expenses for your property.

2. What Are Some Of The Ongoing Costs of Owning A Holiday Home Abroad?

Apart from mortgage payments (if you’ve taken a mortgage, that is), some of the ongoing costs you’ll need to keep in mind are: 

  • Taxes
  • Insurance payments
  • Utility bills
  • Maintenance fees
  • Foreign currency transfer fees

Make sure you consult with professional brokers or lawyers to understand all these costs and make a budget accordingly.

CeMAP & CERER Qualified Mortgage Adviser

I am CeMAP & CERER qualified mortgage adviser and have helped a number of clients realise their dreams when they thought it would not be possible. I’m skilled at getting mortgages sorted for people with a history of missed payments, CCJs, defaults, debt management programmes, IVAs and bankruptcies.

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