Purchasing property overseas can be an exciting yet challenging process. To gain insider advice, GOBankingRates spoke with Sean Woolley, founder and director of Cloud Nine Spain, a leading real estate agency for international buyers on the Costa del Sol. With decades of experience guiding North Americans through this journey, Woolley shared his top tips for successfully buying a home in Europe.
1. Immerse Yourself in the Lifestyle First
Woolley stressed the importance of deeply experiencing European lifestyle and culture before purchasing: “Make it an extended trip and try to explore and get a feel for lots of different places, as the variety within quite small areas is extraordinary.”
He advised watching expat videos, reading blogs and joining community groups to understand daily life in your desired region. Travel extensively through short-term rentals and absorb the local culture. Woolley said, “Take time to travel, get to know the people, the areas and the different aspects of the culture and lifestyle that the different areas can offer.”
Spain alone has dramatically diverse regions. Compare metropolitan Madrid, coastal Catalonia, laidback Andalusia, and the Balearic and Canary Islands. The same can be said of every country in Europe — so before you buy, make sure to visit all the areas you’re interested in.
2. Work With a Local Real Estate Company
According to Woolley, agents with regional expertise can decode cultural nuances and suggest areas matching your wish list: “Speaking to an expat who has made the move and understands your needs, as well of course speaking your language, definitely helps smooth out any bumps in the road.”
Local knowledge is invaluable while navigating new property markets. Communicating your needs to multilingual agents familiar with suitable neighborhoods prevents hassles. They can answer lifestyle questions beyond listings.
“Once you’ve narrowed it down to a key area, get in touch with a local real estate company and discuss your needs, preferences, concerns and the areas you really like,” Woolley said.
3. Research Visa and Residency Rules Upfront
Woolley emphasized thoroughly investigating legal requirements before buying: “Different countries within Europe have different requirements to spend extended periods of time in the country and so this needs to factor into your decision-making process.”
Countries offer assorted visas based on investment amounts, retirement status, employment and more. Understand regulations like Spain’s €500,000 “Golden Visa” for investors. Confirm eligibility to avoid headaches.
“Seek legal advice around visas and immigration requirements,” Woolley shared. Knowing the rules in advance prevents unpleasant surprises.
4. Get Pre-Approved for a Mortgage
According to Woolley, confirming available financing early on is critical: “Make sure you’ll be able to get a mortgage and see how much you can get.”
Provide extensive financial records so brokers can analyze eligibility. Woolley said, “Once they are armed with this information, a decision in principle can be given pretty quickly, normally within a week.”
Understand required income, loan-to-value ratios, and repayment capacity criteria in your destination country. “Contact a mortgage broker at the beginning of your search and make sure you will be able to borrow the money you need,” Woolley stated.
5. Break Down All Applicable Property Costs
Beyond the sales price, Woolley said buyers must educate themselves on tax and transaction costs — costs which often approach 10-15% in places like Spain: “It’s really important that you understand the costs involved in purchasing a property in a different country, and also the costs involved in owning the property from month to month.”
One-time closing costs and recurring ownership expenses like utility bills and community fees should be researched. Woolley said, “In addition to the costs of purchase, you will also need to consider the property’s running costs and community fees.” Avoid financial sinkholes by budgeting total costs.
6. Work With a Currency Exchange Service
To maximize savings, Woolley suggested using a currency broker when transferring funds abroad: “By using a currency broker, you can also save money when you transfer your funds into Euros, so that’s another way to maximize your spending power when you come over to buy.”
Exchange companies provide better rates than banks for large international transfers. Given currency fluctuations, specialist brokers optimize exchange values so your money goes further overseas.
7. Leverage Expert Resources Around You
Finally, Woolley recommended tapping knowledgeable professionals to guide each stage: Local agents, lawyers, mortgage brokers and currency experts together facilitate seamless purchases abroad. Building a support team saves money and prevents mistakes.
“The good news is that property prices and living costs in the South of Spain are considerably lower than the U.S., so you should be pleasantly surprised by how far your budget will stretch,” Woolley indicated.