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Costs Connected to Properties
Additional Costs when Buying
In addition to the actual purchase, you will have to be prepared for a number of further costs. Fees for a real estate agent are in most cases paid by the buyer of the property and typically range around 2-8% of the property value, depending on where your new house or apartment is situated.
If you have employed the services of a solicitor, you obviously have to pay their fees as well. Furthermore, you will surely be facing taxes in one form or another, for example as taxes on your property purchase, registration fees or stamp duties when officially registering your new property. Such fees and taxes can vary greatly from country to country and some states, as for example Singapore and Hong Kong, even have additional duties or taxes that specifically target foreign buyers. So be sure to inform yourself thoroughly and to get independent, legal advice where necessary.
Running Costs for Your Property Abroad
Next to the one-off costs at the time of your purchase, you will need to be prepared for various running costs. In many countries you have to pay a yearly property tax that is based on the value of your house or apartment. Utility costs for water, water disposal, heating, electricity, garbage disposal and so on will prove to be a further, often hefty budget item.
And, while not mandatory everywhere, we strongly advise you to insure your home against prominent dangers, such as for example fire, water or storm damages, theft and vandalism. The height of these insurance costs of course again depends very much on where you live.
Furthermore, if you want to buy overseas property as a form of investment you will in many countries need to be prepared to pay further taxes. Income-taxes on rent are nothing unusual and you might even have to pay income-tax when reselling your property. This is especially the case if you have only owned it for a relatively short amount of time (e.g. 10 years or less in Germany).
In regards to such income-taxes you will also need to make sure that you are not taxable in both, your country of origin and the one your property is situated in. If that is the case, check if there are any double tax treaties in place between the two countries, so that you do not have to pay twice.
