The questions you have to ask before you buy
What a property abroad costs, and which rules apply to you, depends on the country, on the property, and on whether you are an EU citizen. Nobody can tell you that in general terms. But somebody can tell you which questions to ask — and who to ask.
7 min read
All information without warranty. This text is orientation and replaces no legal, tax or investment advice. What applies in your case depends on the country, the property, your nationality and your personal circumstances, and can change at any time. Take advice from a professional qualified in the country concerned before any decision.
Why there are no figures here
There are plenty of pages online telling you what acquisition costs run to in a given country. Some of them are right. Which ones, you find out at the notary.
Tax rates change, allowances apply only under conditions, and rules for buyers from abroad differ according to whether you are an EU citizen, where the property sits and what you intend to use it for. A figure that holds for a German buying a second home in one region can be wrong for a Swiss buyer in the next village.
So there is not a single one here. What is here is the list of questions, sorted by who to put them to. Print it, take it with you, and listen to how confidently the answers come back. Anyone who dodges one of these questions has already told you something.
To the seller or agent
Who owns the property according to the register — and is that the same person selling it here? Is there a registered title, or is transfer still outstanding? Are there charges, mortgages, rights of way or of use?
Was what was permitted actually built? Is there a sign-off or completion certificate? Are extensions, the pool, the terrace roof permitted — and if not, what follows from that for me?
What do I pay each year if I do nothing here: property tax, insurance, management charge, standing charges for electricity and water? And not estimated, please, but from the statements of the last two years.
Why is it being sold, and how long has it been on the market? Both tell you more about the price than any valuation.
To a lawyer in the country where the property is
What matters is not only that you have one, but that they are qualified in the country where the property sits, speak your language or English, and earn nothing from the sale. A lawyer recommended by the seller does not automatically represent you.
Ask them: what has to be checked before any deposit? How is it ensured that my money moves only once transfer is secured — is there an escrow arrangement, and who holds it? What deadlines run after signature, and what happens if one side misses one?
Then the questions about you personally: do additional rules apply to buyers from abroad — permits, size limits, restrictions near the coast or near borders? Does it make a difference whether I am an EU citizen? Do I need a tax number, an account in the country, a local representative?
And the question people rarely ask: what happens to this property when I die — under which law, with which taxes, and what should I arrange now so that my children do not have to sort it out later?
To a tax adviser — ideally in both countries
On purchase: which acquisition costs arise, at what level, and when are they due? Is there a difference between new build and existing stock? Can there be a further demand if the authority later assesses the value differently from the purchase price?
While you own it: what do I pay on an ongoing basis in the country of the property? Do I have to file a return there even if I do not let it? And which of that affects me additionally at home — there are double taxation treaties, but they do not work the same way everywhere.
If you let it: where is it taxed, which costs are deductible, do I have to register in the country, do I need a licence for short-term letting? That last point is now tightly regulated in a number of holiday regions, and it is enforced.
On sale: how is a gain taxed, are there holding periods, is anything withheld when a foreign owner sells?
To the management or the owners association
With an apartment, or a house in a development, the management has a large say in how pleasant the ownership turns out to be — and how expensive.
Ask: what exactly does the monthly charge include, and what does it expressly not include? How has it moved over the last three years? Are there reserves, and how large are they measured against what is coming up — roof, facade, pool plant, lift?
Are special levies on the horizon? Are there open disputes or proceedings within the association? How many units are let, how many owner-occupied, how many empty? And if you intend to let: is that permitted at all under the house rules?
To yourself
How often will I realistically be here — not in the first year, but in the fifth? Who is coming with me, and for how many more years?
If I want to let: who does the handover, the cleaning, the linen, the answering of enquiries? Am I counting the weeks I hope for, or the weeks the place actually gives — and have I deducted the weeks I am there myself? That is where the arithmetic usually goes wrong.
And the most uncomfortable question: how do I get out again? How long do comparable properties sit on the market here before they sell? Anyone who buys a holiday property without having thought the resale through has made only half the decision.
One more remark
Most of these questions cost nothing but the nerve to ask them. A seller who answers them plainly is a good sign — and one who waves them away is a sign too.