Planning to buy your dream homes in foreign countries is getting more exciting with the dollar getting even stronger compared to euros and other currencies, says Huffington Post.
But before you dream of living happily in your beachfront home and basking lazily in the sun, here are four tips you should consider:
1. Learn the Country's Laws
Be knowledgeable of the country's laws regarding ownership of properties. Ask what type of properties may be owned by a foreigner like you. For instance, in the Philippines, foreigners may buy condominium units as long as not more than 40% of the units in a project are acquired by foreigners, according to Republic Act No. 4726, "Condominium Act," says BC Philippines Lawyers.
2. Do your Math, Know the Mortgage Rates and the Terms.
Currently, U.S. mortgage rates are below 4 percent for a 30-year fixed-rate. In other countries, terms may be shorter and rates, higher.
In an article of The Wall Street Journal, an Atlanta-based couple, Mr. Harris and Ms. Bradley, bought a Mediteranean-style villa in Dominical in April 2014. However, a Costa Rican Bank gave them a mortgage rate above 7 percent which was very high compared to the 4.45 percent reported average rates in the U.S. that period. With careful thought, the couple did not want to be tied with high interest rates for a long time, so they paid the property in cash.
If you can't pay in cash, you must also have a global bank you could tap to have financing ready for you abroad, Saul Rasminsky, owner and broker of Dominical Real Estate, agent of Mr. Harris and Ms. Bradley, tells The Wallstreet Journal.
3. Choose Your Property Well: Be Mindful of the Details
It would be a smart choice for you to search for completed projects in your chosen area and determine if the finished product truly suits your taste, as suggested by Vernon Martin, principal and international appraiser of American Property Research in Los Angeles.
"One dirty little secret of marketing vacation residences to foreigners is that many projects have not been built yet," Martin told FOX Business in 2011. "They cannot get built without financing ... and they cannot get financing without substantial presales accompanied by substantial cash deposits." You will end up having buyer's remorse if the project never materializes.
It is also important to know if the developer behind the project can be trusted. "When you're in the country, ask the builders what else they've built," said Brooke Rundle, a Coldwell Banker real-estate agent who organizes tours for U.S. and European investors in Belize and Nicaragua.
4. Plan Ahead: Have an Exit Strategy
It may also be hard to sell a home in foreign countries. If you plan to sell your vacation home, prepare for it by listing your home years before you plan on leaving it, says WSJ.
