Buying a house abroad anywhere you are is costly. It is one of the most expensive things to achieve especially when you are part of the working class. In foreign countries, competition between its residents for housing is high. This is because these countries have the most limited area. Then, there are many locals and foreigners trying to get their share of land. The entrance when it comes to foreign country’s number of residents is because of its busy business environment. Since all the foreign countries are one of the world’s economic hotspots, many businesses from different industries are trying to set foot in.
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Along with these businesses are its workforce that is also residing in a foreign country. There is a high demand for housing that is why the cost of buying a house is relatively high. This trend is true for residents and even foreigners. However, just like any other country, prioritizes its residents. They offer more relaxed policies and requirements and lower the cost of buying a house in a foreign country. However, this does not mean that foreigners can’t buy one. There are just various guidelines and requirements that a foreigner must meet. So, before buying that property, let us talk about 3 points to consider for living abroad buying a house.
#1 Type of property
The first thing you must consider is the type of property that you want. There are many properties available in the country but there are limited options for foreigners. Decide if you want a residential or non-residential property. Property prices options depend on the type of property that you want. Sample housing types are HDB flats, semi-detached properties, private apartments or condominiums, and landed properties. The majority of natives live in HDB flats however migrants are not allowed to avail of this kind of housing unless they are married to a native of the country. Opting for an HDB flat is practical since it is cheaper than the usual cost of buying a house in the country. Below is a list of properties that are restricted and non-restricted:
- Condominium Unit
- Flat Unit
- A leasehold estate in a landed residential property (not exceeding 7 years)
- Shophouse (commercial use)
- Strata landed house
- Executive condominium unit after privatization
- Terrace house
- Semi-detached house
- Bungalow/detached house
- Shophouse (for non-commercial use)
- Association premises
- Place of worship
One should be careful of these housing types as it may cause a problem along the way. So before deciding which house to buy, take note of these restrictions.
#2 Additional taxes
As stated, the cost of buying a house in a foreign country for foreigners is more costly. This is because the country prioritizes its residents. Property prices costs are more affordable if you are a citizen of that country or married to one. All homeowners, even locals, have to pay monthly, quarterly, or annual maintenance costs. Also, owners are required to pay property taxes to the government. This makes the property prices cost even higher.
In addition to the usual taxes, migrants are required to pay an added stamp duty in the form of Additional Buyers Stamp Duty (ABSD). ABSD means an additional 25% tax on your property prices buildings. This tax is payable within two weeks of completing the Sale and Purchase Agreement of any property. However, if you are a US National or a permanent resident from Switzerland, Liechtenstein, Norway, and Iceland, then you will pay the same tax rates as a citizen. This tax is in addition to the same taxes citizens pay which foreigners are also required to settle.
#3 Hire a legal expert
Since you are a foreigner, one smart move is to hire a legal professional. This is important when it comes to drawing up legal documents. It is better to be sure than get scammed. Property prices are high enough, so you should be careful when dealing with important documents. This way, you can make sure that you are getting into the right deal. The cost of buying a house is high so you should take care of your money. Hiring a lawyer can prevent future complications.
Make an informed purchase
Property prices are relatively high, especially for foreigners. So, before you make a purchase make sure that you know what you are getting into. With SRX Property we can help you make a practical deal. Visit us today and be ready to purchase your home tomorrow.