You have just returned from an amazing trip where you travelled in Europe. Now you are thinking you want to buy a home over there. Whether you permanently move to Europe, or simply buy a second home as a vacation spot, you’ll need to know a few things. You first might want to get set up with an English speaking lawyer in Europe as there are laws and things you’ll need to fully understand in order to be safe and protect your interests. Just like how home prices can vary from country to country, so can transaction costs. These transactions costs can include registration taxes, property transfer taxes, legal fees and of course agents’ commissions which isn’t surprising.
No matter where you are moving to Europe from, you’ll want to be sure and understand the conversion rate so you know exactly what you can and can’t afford. It is a known fact that housing markets in many parts of Europe are struggling, so theoretically you can pick up a great house for a good price. Some specific areas to look at for good deals include Ireland, Spain, Greece and Eastern Europe. If you are considering France, keep in mind that the average detached home costs approximately $800 per square foot. Therefore, it you were looking for a home that was 2,000 square feet your price would be around $1.6 million dollars. A little pricey if you ask me!
Furthermore, transactions costs could equate to up to 13% of the purchase price so in the same scenario we’re looking at additional costs equalling $208,000. That’s a lot of money! Unlike realtors here in the US, over in France they don’t have multiple listings available, so you’ll be going from agent to agent to get a wide overview of homes. Germany on the other hand is much more easy on the wallet. The average home price for something built in 2008 so about 5 years old is $296,000. That’s a lot easier to swallow if you ask me! Also their transactions costs are a lot lower coming in with a max of 9% of the purchase price. In Germany however you won’t find the same options for mortgage payment help so make sure you are able to put down a decent down payment. This is definitely something to keep in mind. An interesting fact is that about 20% of all German residential property is bought for and paid in cash. Third example is moving over to Ireland. Within the last 3 years the average home price was listed at $257,000 so very reasonable.
There are even no restrictions on foreign property ownership. You simply need to pay a deposit which is 3% of the purchase price and at the time the contract is signed you are obligated to pay another 10% of the purchase price minus the deposit. So on a $257,000 home you’d have to pay a deposit of $7,710 and then pay $24,929 at the contract signing. If owning a home in Europe is something you are interested in then check out real estate Europe for some great options!