The 2021 has been a record year for house prices in the UK, with values having surged by around £16k on average over the course of the previous 12 months. Such growth is being underpinned by a lack of supply and a subsequent surfeit of demand, however, making it increasingly hard to buy competitively priced homes on these shores.
While the overseas market may offer increased value to buyers, there are several considerations to keep in mind when purchasing an international home. Here are some of the most important:
1. Taxes and Location
Two of the most fundamental considerations are taxes and location, as each of these elements will have a critical bearing on your initial and ongoing costs. Firstly, you’ll need to identify the tax requirements in the area you’ll be moving into, including stamp duty equivalents and the duties that will be leveraged against any profits generated from the property (if you intend to rent or lease the property for some of the time).
In terms of location, this will also have a dramatic impact on your overall cost as a buyer. Certainly, you’ll need to tailor your choice of destination depending on your objective as a property owner, with regions such as Ecuador renowned for their exceptional climate, unique culture and incredibly cheap real estate.
2. Value Retention
Even if you intend to retain your overseas home and reside in it for an extended period of time, value retention is another key consideration as a buyer. After all, this will impact everything from future resale value (which is important as you may want to sell the property in the longer-term) to real-time rental yields, while it will also confirm whether homes are appreciating or depreciating in value in a particular region.
This also offers a key insight into how desirable an area is to live in, which is in turn indicative of value and whether or not you’re receiving the requisite bang for your buck.
3. Currency Exchange Rates
The relevant currency exchange rate is another critical consideration, and one that will also impact exactly how much you have to pay for your property.
For example, if you’re targeting a property overseas but intend to complete the purchase in your own, domestic currency, then you may end up paying more overall if the exchange moves against you. The key is to track real-time exchange rates using a licensed web trading platform, which provides live coverage of all major, minor and exotic pairings while providing expert and detailed analysis of the trends behind the price movements.
This way, you can begin to understand specific pairings and time of your purchase or money transfer, ensuring that you optimise the value that you receive in exchange for your investment.
Also read: Flourishing with Real Estate Industry by Following Strategic Approach