For years, the appeal of owning land abroad has dominated the aspirations of many, but as more people make this dream a reality, a number of frequently made mistakes have come to the forefront.
Unlike buying property, which is relatively straightforward in comparison, the acquisition of land abroad can be not only costly but also fruitless for well-meaning but ultimately, uninformed consumers. Buying with a specific purpose in mind can lead to sever disappointments but by understanding the mistakes of those that have gone before, you could sidestep these potentially expensive landmines.
1. Not doing a proper title search
A title search in the UK is very simple to undertake. Your conveyancing solicitor will do this for you, but when purchasing land abroad, you might come up against different legislation and simply forget. The simplest way to avoid this is to ensure you instruct someone in the country you are looking to invest in, as well as back at home, and be sure that you choose someone bilingual and fluent in your language, too. Mistranslated documents are rarely accepted as a reason for mistakes.
Unscrupulous sellers could rely on foreign investors not going through all of the proper channels, and as such a name could be missed on the deeds, leading to years of land disputes and expensive legal proceedings.
2. Not checking permissions
When you have located the perfect piece of land, it would be a huge mistake to simply go ahead with the purchase without ensuring there are requisite permissions in place for what you are hoping to do. Moreover, you need to be absolutely sure there are no restrictions, otherwise you could be the proud owner of land that you can do absolutely nothing with.
It is vital to make sure that you are not buying land that cannot be built on or that has strict permissions in place. If you are hoping to build an impressively large home, for example, and the land you are looking at is earmarked for nothing more than a small cottage, you are unlikely to get permission to change the intended building.
3. Paying in the wrong currency
Buying land can be simple if searches are carried out and planning permissions are checked, but extra diligence is needed when it comes to actually parting with your money. For example, it’s worth paying close attention to what currency exchange rates are doing, as you might be able to save yourself a significant amount by either paying on a particular day or looking to use a more favourable currency.
You could instruct a broker to do this for you, but be aware that this will incur fees. If you are looking to save money during the process of purchasing land, using an online exchange and transfer service could be a more prudent move.
4. Not having a survey
You wouldn’t commit to buying a property, regardless of the country it was in, without a comprehensive survey, so why risk it when it comes to land purchases? This is a mistake so many people make in a bid to speed up the exchanging of contracts – but it can leave you in a perilous position down the line.
A survey will be able to tell you if there are any less-than-desirable aspects to your land, such as a hidden well, unfavourable soil conditions or anything else that could make future building difficult or impossible. Don’t fall into the trap of buying land just because it is a reasonable price – it might be hiding something beneath the surface.
5. Not checking deed boundaries
A plot of land marked out with boundary tape is one thing, but seeing it in black and white, on formal deeds, is another. It is surprising how many buyers assume that the land they see with their eyes is what they will actually own, so always ask to see the deeds, complete with clear boundary marks and check how that corresponds with what you have seen. Also, be clear about every boundary and what your land butts up to, including any planning permission that is in place for neighbouring plots.
Buying land overseas is an exciting investment opportunity, as long as you acquaint yourself with the requisite information beforehand. There’s little point in securing a plot that cannot ever be built on or has such stringent restrictions in place that you can’t fulfil your construction aspirations, especially if you pay too much for it as well. A little information will go a long way in land purchasing and could save you a great deal.