What to consider when buying property abroad
There are factors to consider at the outset, even before you put down a deposit on your chosen property.
Real value of real estate
Real estate advertising portals and agencies almost always list the net price of a property. The final price is increased by transfer taxes, registration fees, notary fees, realtor commissions, and other associated costs. These costs vary from country to country. For example, when buying a resale property in Greece, you’ll pay 3.09% of the property’s value for transfer fees, while in Spain, the rate ranges from 6% to 11%, depending on the region. As a result, the final purchase price increases by 5% to 15% of the initial price.
Maintenance and service costs
In addition to standard utility bills for electricity, water, and waste disposal, almost all European countries, and beyond, levy an annual property tax. Its amounts vary significantly. In Spain, it’s 0.3-0.4%, while in Germany, it ranges from 1 to 2.1%. However, there are exceptions: Georgia, Malta, and the UAE do not impose such a tax.
A number of countries require non-residents to pay for the mere fact of owning real estate, even if it’s not used for its intended purpose. And fees for maintaining swimming pools, elevators, and grounds, as well as for maintenance and security services in residential complexes or condominiums, will place an additional burden on your budget.
Legalization of funds
The funds you plan to invest in foreign real estate must be 100% legal. This will need to be documented. If you transfer funds abroad and the bank becomes suspicious, the transaction will be blocked, and the property purchase will simply not take place.
Property owner status
Not every country offers investors residency in exchange for purchasing real estate. While this option is currently available in Greece, Montenegro, Turkey, the UAE, Thailand, and Cyprus, foreign property owners in Germany, Spain, Portugal, and the UK can only count on a multiple-entry tourist visa for 90 days every six months.
When buying real estate in another country, it’s also important to clearly define your goals. Requirements and conditions will vary depending on whether you’re looking for a cottage or apartment for permanent residence, a second vacation home by the sea, a property for a quick resale, or a rental property.
Which countries are most popular for buying property abroad?
If you’re looking for an investment within the Eurozone, boasting pristine nature, unique medieval architecture, and a relatively low cost of living, then you should definitely join those who have chosen Croatia. The country’s pristine environment, convenient logistics, developed tourist infrastructure, opportunities for a tranquil, secluded vacation, and distinctive Balkan atmosphere will make your stay as comfortable as possible. And the steady flow of international guests will ensure your rental property on the Adriatic coast doesn’t have to sit idle for long periods.
Thailand
Buyers’ interest in this country is driven by its unique climate with endless summers, exotic nature, advanced healthcare, modern infrastructure, and services familiar to Europeans. Furthermore, foreigners are attracted by the simple, transparent transaction process and significant visa incentives for investors looking to purchase a home or apartment.
Housing in Thailand is purchased both for personal use—periodically or permanently—and for renting, since there is no shortage of tourists here at any time of year.
Indonesia
A warm climate year-round, clear waters with ideal surfing conditions, magnificent beaches, and breathtaking natural beauty are just a few of Indonesia’s many advantages. Foreign property buyers are also motivated by the high quality of life and affordability, well-developed infrastructure (not just for tourism), and comfortable living conditions for expats and digital nomads.
Today, the local real estate market offers properties to suit every need: apartments and studios in residential complexes with multifunctional services, villas and townhouses united in gated communities, and properties under construction at various stages of completion.
Oman
Unlike the UAE, Oman strives to preserve its Arabian authenticity as much as possible, complementing it with modern comforts—and this is where its unique charm lies. Furthermore, there are strict restrictions on high-rise construction, so concrete jungles are a thing of the past. Instead, it boasts magnificent natural beauty, a high level of safety, unique innovations and green technologies in construction, demand for short- and long-term rentals, simple purchasing conditions, and a tax haven for foreign investors.
Where is the cheapest real estate abroad?
Georgia
Georgia offers perhaps the most affordable real estate prices in Europe. For example, in Batumi, it’s entirely possible to enter a project at the foundation stage with a budget of €30,000-35,000. Prices for finished apartments without finishing touches and utilities are also reasonable. Of course, this will require a substantial investment. However, this is partially offset by favorable terms from local developers, including interest-free installments with a minimal down payment.
Greece
Compared to other Western European countries, Greece offers quite affordable options, although not in the top tourist destinations. Those looking to buy an apartment or house in the €70,000-€90,000 range should consider the resale market in Athens and Thessaloniki, particularly in residential areas with good infrastructure, as well as real estate in small coastal towns on the mainland. However, buying an apartment or house in Mykonos and Santorini will cost considerably more.
It’s important to remember that low housing prices are directly related to their low liquidity, so budget properties for resale should be purchased thoughtfully and carefully.
Croatia
Despite being a full member of the European Union, it’s still possible to find options here below the European average. If you choose a small apartment or modest house away from the sea, for example, in the suburbs of Zagreb or Slavonia, you can get by for €60,000-80,000.
It’s quite possible to even buy a budget-class property by the sea—if you’re willing to settle for an old fishing cottage in less-than-perfect condition. In this case, a thorough legal review of the property is especially important, as ownership rights to such assets are often entangled among numerous heirs with unknown whereabouts.
Where is the most promising real estate abroad?
The prospects for foreigners purchasing real estate are a combination of factors, conditions, and circumstances that will drive property prices up over the next 5-10 years. We’ve selected the best countries for real estate purchases, which are currently attracting the greatest interest from experienced investors.
Indonesia, specifically Bali
Year-round tourist flows and urban planning restrictions (not every plot of land receives a building permit) create a persistent housing shortage, so demand for high-quality villas and apartments consistently exceeds supply. At the same time, new infrastructure projects are being actively implemented here—road networks are being expanded, and seaports are being modernized. As a result, new locations are being developed within the development zone, where the price per square meter is rising particularly rapidly.
UAE
Not only tourists, but also international professionals, leading entrepreneurs, and representatives of leading global corporations flock here from all corners of the world. They stay in the UAE for years, meaning there are inspiring prospects not only for short-term rentals but also for long-term rentals, as well as for the sale of finished, high-quality homes.
Spain
In recent years, Spanish real estate in major cities such as Valencia, Madrid, and Malaga has demonstrated high returns. Large businesses from other European countries, as well as the United States, are relocating to these cities. Demand for rental and purchase of housing is outpacing developers’ capacity. Therefore, after purchasing real estate in Spain in these locations, you can expect its capitalization to increase over the next few years.
Thailand
A local trend in recent years, actively supported by the authorities, is the transformation of Thailand, and Phuket in particular, from a tourist destination into a hub for full-time residential development. To this end, modern highways are being built, the airport is being modernized, and international schools offering European-style curricula and progressive multidisciplinary clinics are opening. As the island develops, property prices are rising. And prices in other locations are following suit, opening up excellent prospects for today’s buyers.
Oman
Today, Oman is often compared to the UAE of 15-20 years ago. This is precisely its potential: the market is still in its infancy, meaning profitability will grow rapidly in the coming years. By purchasing real estate in Oman within an integrated tourist complex, a foreign citizen has the opportunity to register full ownership and obtain a residence permit.
Key steps to buying property abroad
With the exception of a few minor nuances, the purchasing process is similar across different countries. Therefore, the step-by-step purchasing process we’ll describe below is standard.
Step 1: Select your country and budget
At this stage, you choose a country based on your goals—relocation, seasonal vacation, passive income from rentals, or resale. You also determine your maximum possible budget, including the cost of the property itself, taxes, and additional expenses.
Step 2. Search for a property
Now it’s time to actually choose a property. You can do this yourself, exploring both international platforms and local aggregators. Alternatively, you can sign a contract with a real estate agent and make your selection based on their catalog of current listings.
Step 3. Due Diligence
A legal due diligence of real estate is a mandatory and critical step. If you decide to proceed independently, seek an independent local attorney to represent you. They will check to see if the property is mortgaged, if there are any outstanding litigation claims, and if utilities have been paid. For properties under construction, they will verify the validity of any construction permits. They will also determine whether a foreigner requires official permission to purchase real estate.
If your interests are represented by an agency, checking the seller’s documents is the responsibility of the company’s in-house lawyers.
Step 4. Reservation and deposit
To remove the item from sale and lock in the asking price, you, as the buyer, must pay a deposit. The amount is determined individually and can be up to 10% of the purchase price. Please note that if the transaction falls through due to your fault, your deposit will not be refunded. However, if the current owner is found to be at fault for the breach of contract, they will be required to return the deposit double.
At this stage, the parties sign a preliminary agreement.
Step 5: Opening a bank account and transferring funds
To pay for the transaction, you must obtain a local tax identification number and open a bank account in the country where the property is being purchased. At this stage, the main challenge is successfully passing the financial institution’s due diligence and providing a comprehensive set of documents confirming the legal origin of the funds.
Step 6. Signing the purchase and sale agreement
The finalization of the transaction, with the signing of the main contract, typically occurs in the presence of the local official registrar. However, there are exceptions. For example, in Turkey, Vietnam, and some other countries, the participation of a notary is not required. After all the details have been finalized, and in the case of an installment plan, the payment schedule has been approved, the parties certify the document with their signatures. Upon completion of the transaction, the new owner receives the keys to the property.
Step 7. Registration of ownership
At the final stage, the registrar or lawyer representing the buyer submits the documents to the state property registry. There, the property is transferred to the new owner’s name, after which an official extract is sent to them.
How the property buying process differs by country
While the general logic of the algorithm for purchasing real estate by a foreigner is similar, there are details that differ significantly depending on the legislation and tax policy of a particular country.
| Page | Deposit amount | Terms and conditions for opening a bank account | Additional costs when purchasing | Type of ownership by foreigners | Residence permit and citizenship |
| UAE | 10% of the cost | 1-14 days – needed mainly for purchasing resale property | 4% (Land Department fee plus fixed fees totalling approximately €1,000) | Freehold in special investment zones, long-term lease outside of them | Investor visa for 2 years upon purchase of a property from 750,000 dirhams.
The property must be located in a Freehold Zone open to foreigners. |
| Turkey | 2-5 thousand euros or a percentage of the cost – up to 10% | 1-3 days, minimum bureaucracy | 4% (tax on transfer of ownership) plus 6-7% (costs for fees, insurance, translator, property appraisal) | Freehold on both the ground and the object | A 2-year residence permit with the option to extend it upon purchasing real estate worth at least €180,000. Citizenship can be applied for after 5 years.
Apply for citizenship immediately upon purchasing a property worth €350,000 or more.
|
| Georgia | 1-3 thousand euros | 1-2 hours with minimal compliance | Less than 1%. No purchase tax, other fees total no more than €90. | Freehold – excluding agricultural land | Residence permit for 1 year upon purchase of real estate from €130,000.
Residence permit for 5 years upon purchase of real estate from €260,000.
You can extend your temporary residence permit and apply for permanent residence.
|
| Indonesia | 4.5 thousand euros or 10% of the cost | 3-7 days | From 1 to 13% (12% VAT for new homes or 5% for existing homes plus 1% notary fees. For long-term rentals, only notary fees are charged) | Leasehold – long-term lease with renewal | Second Home Program – Golden Visa for 5 or 10 years with an investment of €115,000 in an Indonesian bank.
Golden visa for 5 years for the purchase of real estate from €350,000 and for 10 years – from €700,000. |
| Spain | 3-10 thousand euros or 10% of the cost | 1-3 days, strict compliance, detailed income declaration | 8-15% (10% VAT on new buildings or 6-10% tax on secondary properties plus notary fees) | Freehold | Currently, there are no programs for obtaining a residence permit based on real estate. |
* The data in the table is current at the time of publication. This information is for informational purposes only and requires further clarification due to changes in the real estate market.
In some countries, particularly Cyprus, Malta, and some Greek islands, foreigners cannot purchase real estate without special permission. This should also be factored into your plans.
Assistance from a specialist in purchasing real estate abroad
Advertising portals often portray independent searches and purchases of foreign real estate as simple, quick, and completely understandable to the average person. However, they often fail to mention the pitfalls and high risks of losing your savings. Therefore, professional support is essential for a successful transaction.
It’s important to understand that a broker or realtor and a lawyer have different responsibilities in this process. A broker or realtor helps you find a suitable property, negotiate the most favorable installment plan with the developer, secure a discount from the seller, and, if a property appraisal is needed, find an independent expert. However, conducting a legal due diligence, reviewing the seller’s documents, and checking the bank agreement for hidden fees and unauthorized payments if the mortgage is being processed abroad are the lawyer’s responsibilities. They also help you properly prepare the necessary documents for the transaction.
The optimal solution in this case is to enter into a contract with a company that has all the necessary specialists on staff and delegate important tasks to them.
Common mistakes when buying real estate abroad
Buying without a lawyer
It’s a dangerous misconception to rely on the lawyers of the developer or the seller of the completed property. They protect their clients’ interests, not yours. To ensure a safe property purchase, it’s advisable to engage an independent professional in the process.
Underestimating additional costs
Having spent all your available funds on the net purchase price of a property, you may find yourself in a difficult situation. Taxes, fees, duties, notary, translator, and registrar fees add approximately 8-15% to this cost. It’s important to budget for these costs early to avoid the deal being blocked at the most crucial moment.
Lack of title verification
Purchasing real estate without thorough due diligence is always a gamble. It could be mortgaged to a bank, under foreclosure, subject to a property dispute, built in violation of regulations, or not intended for the purposes for which you’re buying it. A real estate registry extract costs just a few euros—for your own safety, it’s not worth skimping on.
Signing documents without translation
Never sign a document written in a language you don’t understand. A translation by a certified professional, who is legally responsible for the accuracy and veracity of the wording, will save you from unpleasant situations.
FAQ
How long does it take to buy property abroad?
Depends on the country, on average from 2 weeks to 3 months.
Can a foreigner buy real estate remotely?
Yes, this is standard practice in most countries. The transaction is completed either entirely online or through a trusted representative.
Is a personal visit necessary?
A personal visit is not mandatory, but we recommend visiting at least once to view the property, assess the location, and infrastructure in person, and also to visit the bank – your presence will significantly simplify and speed up compliance.
What are the biggest additional costs when buying real estate?
The most expensive additional expenses are VAT and title transfer tax. Depending on the country, these amount to 4-12% of the asset’s value. Legal support and notary fees are the second most expensive.
Is a mortgage necessary and will a foreigner be given one?
The advisability of borrowing depends on the capital available to you. If necessary, a non-resident can obtain a mortgage in almost any country. However, the terms will be more stringent than for residents: the down payment will be 40-50%, and the interest rate will be quite high. Furthermore, for foreign applicants, the bank will scrutinize their documents with extreme care.
Does purchasing foreign real estate grant the right to reside (residence permit)?
In most countries, it’s not possible to automatically obtain a residence permit by purchasing real estate. To do so, you must purchase real estate worth at least a certain amount. The thresholds vary – for example, in Cyprus it’s €300,000, while in Greece it’s €400,000-€800,000, depending on the region and type of property. Northern Cyprus is an exception: here, you can become a resident by purchasing any livable property.
What should I do if something goes wrong after purchasing?
If defects or debts are discovered after the property is registered, if the developer is delaying the delivery of the new building, or in any other ambiguous situations, notify your lawyer of the problems. They will file a claim, attempt to resolve the issue directly with the seller, and if unsuccessful, file a lawsuit on your behalf with the insurance company or the court.
