LGBT Community Buying Abroad
“Freedom is not merely the opportunity to do as one pleases; neither is it merely the opportunity to choose between set alternatives. Freedom is, first of all, the chance to formulate the available choices, to argue over them — and then, the opportunity to choose.” — C. Wright Mills
In the last six years, we’ve had more than a few friends talk about leaving the country. Jeanine and I aren’t going to be packing our bags anytime. We always said that Melanie and Lindsay would be moving back from Canada in a sixth season of Queer as Folk.
But buying a home abroad is different that bailing on the good ole U.S.A. Since I mentioned second homes the other day, it got me thinking about two friends that want to buy a house in Spain and they’re heading over there in Sept to check out the more affordable foothills near Madrid.
According to 2ndHome.net, the International markets are heating up. Ellen Newbury writes, “The most popular destinations for Americans seem to be in Latin America, as this is where the dollar exchange is the best. Mexico, referred by some as the ‘south the border Florida’ is the hottest destination today. This is the number one foreign hotspot.”
“Panama, the third largest country in Latin America, is also emerging as a popular second home designation. The secret is ‘out’ for Panama, and Americans, especially retirees, are expected to move there in droves in coming years.
I found the latest issue of 2ndHome.net before boarding an eleven hour flight home at Heathrow and just like international business travel; owning overseas might not be that glamorous. Gerri Willis at CNNMoney.com cautions buyers. She writes, “Be warned, sometimes the grass isn’t always greener across the globe. You’ll need to find out the rules about foreign ownership for the country you’re interested in.”
She gives 5 Tips to Buying Property Oversees. You can find them here, but the biggie is to Count on Paying Cash. Who knew? She continues, “To figure out what you can afford overseas, assume you can pay cash only. Financing mechanisms like mortgages aren’t as sophisticated as they are in the U.S.”
“In many countries, such as Mexico, Greece, Spain and Eastern Europe, transferring property is historically paid for in cash. If you can’t afford to buy property without a mortgage, you’ll want to check out English-speaking countries and former colonies like Singapore, Hong Kong or South Africa. But even then, you should be prepared to put down at least a 40 percent: That’s to allay fears that you’ll get on the next plane and skip the country.”
I had a friend that briefly owned a home in South Africa. Funny thing — she eventually sold it. Her reason: “Have you ever flown to South Africa?” My point exactly!
The cash requirement really depends on where you are buying. In some places you can put down a deposit of less than the 40% quoted (e.g. Australia and New Zealand).
The other major headache with owning property overseas is arranging for someone to look after it for you.
It is definately worth noting that buying abroad comes with its risks, do your research and speak to people in forums who have already bought.
What rights do you have in that country?
Do you speak the language or have a network of people who can help you?
What is the market really doing (not what agents tell you)?
Leaving your home country can be daunting and so I would recommend visiting a place a number of times at different times of the year to see whether it is really for you and you like what is on offer.
In regards to deposits, many developers offer better payment terms than 40%. If you negotiate you may find you only need 10% down and then structured stage payments in the more established property markets.
I think it’s important to make sure you can easily get to your house abroad – say for a weekend trip. It’s reassuring to go and look at the house at least once every two months to check that all is OK. If you cannot face doing such a trip several times a year, then perhaps the second home is not for you. There are lots of things to worry about, financially as well as practically!