Guide To Buying A Holiday Home Abroad

Owning a holiday home in your favourite destination can be rewarding. However, it’s also a major commitment. There’s much to consider before you buy, including local property laws, ongoing costs, and how to protect your investment. This guide highlights key steps, popular locations, and important checks to help you make an informed decision.

Why Buy A Holiday Home Abroad?

Buying a property overseas can be an exciting step for many reasons:

• Your own holiday spot: Enjoy a place that’s yours, where you can relax, decorate to your taste, and spend extended time abroad without worrying about availability or seasonal price hikes.
• Saving money on trips: Cut the cost of hotels and rentals over time, which could make regular holidays more affordable in the long run.
• Retirement plans: Use the property as a permanent home later in life, so you have a base in a location you love.
• Extra income: Let the property to holidaymakers when you’re not using it, which could help cover maintenance, utility bills, and other running costs.
• Possible value growth: Benefit if the property increases in value over time, potentially providing a long-term investment as well as a place to enjoy.

Researching Buying A Property Abroad

Before making any decisions, it’s important to do thorough research to avoid costly mistakes later. This can include:

• Understand local laws: Find out the legal requirements for buying property in your chosen country, including any restrictions on foreign buyers. If you plan to rent it out, check the rules on holiday lets or long-term rentals too.
• Learn about the area: Spend time in the location at different times of the year to get a feel for the climate, atmosphere, and local amenities. Consider transport links, healthcare facilities, and how busy it gets during peak seasons.
• Compare property prices: Research the local market to understand typical prices for the type of property you want.
• Speak to other owners: If possible, talk to people who already own homes in the area or on the same development. They can share useful insights on day-to-day living, maintenance costs, and working with local services.

Further Considerations For Drafting A Shortlist Might Include

When narrowing down your options, it’s worth thinking about factors that could affect your enjoyment of the property and its long-term value:

• Natural disasters: Some areas are prone to earthquakes, floods, or severe storms. These can damage the property, increase insurance premiums, and cause disruption. Research the risk level in your chosen location and check what protection might be available.
• Rental yields: If you plan to rent out your property, be aware that some lenders require rental income to cover a set percentage of your mortgage repayments (often around 125-145%)[1]. A local rental agent can provide an estimated yield to help you assess potential returns.
• Regulations and laws: Many countries have specific rules for foreign buyers. In some cases, you’ll need special documentation. For example, buying a house in Italy requires a Codice Fiscale[2]. This is your tax identification number, similar to a UK National Insurance number.

Find An Overseas Property

There are many helpful resources to use when narrowing your search for property overseas. You may also want to lean on local property experts, such as estate agents, but be mindful they might charge a fee.

• Online property websites: A quick search will uncover specialist sites listing overseas properties. You can also seek recommendations from friends or family who have purchased abroad, and join online forums where owners share first-hand experiences. Reviews can be useful for gaining unbiased opinions on local services and agents.
• Local real estate agents: Once you have an idea of your preferred area and budget, a local estate agent can provide on-the-ground knowledge, guide you through the buying process for overseas buyers, and suggest properties you might not find online. They can also connect you with surveyors, mortgage providers, and legal experts.
• Housing developers: New-build properties often sell quickly and may not be widely advertised. Contacting reputable developers directly could give you early access to plots or properties in sought-after locations. In some cases, you may even be able to commission a custom build.

Where To Buy A Holiday Home Abroad

The best location for your holiday home depends on your lifestyle, budget, and personal preferences. Factors such as travel time, cost of living, local climate, and amenities all play a part. For example, if you have pets, you may prefer somewhere within driving distance or with a milder climate. Families might look for larger properties near beaches, parks, or attractions.

According to A Place in the Sun[3], Spain remains the most popular choice for buyers, closely followed by France and Portugal, but Italy also continues to attract interest for its culture and charm.

Popular destinations include:

• France: Known for its diverse landscapes, from Mediterranean beaches to Alpine ski resorts. The south of France is popular for its warm climate and relaxed lifestyle, while regions like Brittany and Normandy offer more affordable options within easy reach of the UK.
• Spain: Famed for year-round sunshine, vibrant culture, and varied coastlines. Popular areas include the Costa del Sol, Costa Blanca, and the Balearic Islands. Spain offers a wide range of property types, from modern apartments to rural fincas.
• Italy: Ideal for those seeking history, architecture, and world-class cuisine. From Tuscan farmhouses to apartments on the Amalfi Coast, Italy has something for all lifestyles.
• Portugal: Attractive for its mild climate, beautiful beaches, and relatively low cost of living. The Algarve is a favourite for holidaymakers, while Lisbon and Porto appeal to those seeking a city break location.

Legal Investigations For Buying A Property Abroad

Once you’ve found a property you want to buy, you should carry out thorough legal and structural checks before completing the purchase, including:

• Get independent legal advice: Use a solicitor who isn’t connected to the estate agent or developer to avoid any conflicts of interest.
• Choose a lawyer with local expertise: Work with someone familiar with property laws and regulations in your chosen country, ideally with experience advising overseas buyers.
• Consider an independent translator: If legal documents aren’t in your first language, a qualified translator can help you understand the full details before you sign anything.
• Get written confirmation: Ensure all agreements made during negotiations are clearly documented and signed by both parties.
• Check property ownership and debts: Verify that the property deeds are in order and that the property or land has not been used as collateral for any loans.
• Check for outstanding utility bills: In some countries, unpaid bills for services such as water, electricity, or gas may become the responsibility of the new owner.

While you may choose a UK-based solicitor or surveying company, reputable local English-speaking professionals can also provide valuable local knowledge. Either way, ensure they’re fully qualified and experienced in handling international property transactions.

How To Fund A Holiday Home Abroad

There are a few different ways to finance a property overseas. Here are some of your options:

Securing an overseas mortgage

The type of mortgage you’ll need depends on how you plan to use the property. Short-term holiday lets usually require a holiday let mortgage, while long-term rentals may need a residential buy-to-let mortgage. In many countries, you’ll need a bigger deposit than in the UK, often at least 20%, and sometimes more. Larger deposits can also mean better interest rates.

Keep in mind that the Financial Conduct Authority (FCA) doesn’t regulate property transactions outside the UK, so you may wish to choose using a UK-based broker with knowledge of the local market which can help reduce risks.

Getting A UK Mortgage

Some UK banks offer mortgages for overseas properties, but they may be limited to certain countries. Terms and rates can vary, so it’s worth speaking to several lenders to see what’s possible.

Remortgaging Your UK Home

If you have equity in your current property, you could release some of it through remortgaging. This can provide a lump sum to put towards your holiday home purchase, but it will increase your mortgage debt, so it’s important to consider the risks.

Using Savings

Paying in cash can avoid interest charges and can speed up the buying process. However, make sure you leave yourself enough of a financial safety net for emergencies and ongoing costs.

Costs Of Buying A Property Abroad

When you’re buying a property overseas, it’s not just the purchase price you’ll need to budget for. There are several extra costs to keep in mind, which can vary from country to country:

• Mortgage fees: This can include broker, arrangement, and administration fees.
• Surveyor fees: You’ll usually need a chartered surveyor to check the property’s condition.
• International bank transfer fees: Transferring deposits and other large sums overseas can come with extra charges.
• Bankers’ draft fees: Some overseas transactions require payment by banker’s draft, which can add to your costs.
• Legal fees: Covering the work of your solicitor, and in some countries, the cost of making a will.
• Tax adviser and local property tax fees: An independent tax adviser can help you understand any local taxes you’ll need to pay.
• Exchange rate fluctuations: Currency changes can affect the price you pay and your mortgage repayments.
• Holiday home insurance: Consider a policy that could protect your property from risks like damage or theft.
• Furniture and fittings: If your property isn’t furnished, you’ll need to budget for this before you can stay in or rent it.
• Translation fees: If contracts and documents are in another language, a professional translator may be needed.
• Community fees: In apartments or gated developments, you may need to pay for shared facilities and maintenance.

Key Considerations Before Buying A Property Abroad

There are several additional factors to be mindful of when buying a second property, including:

The Impact Of Brexit

Since the UK left the EU, UK citizens can only stay in most EU countries for up to 90 days in any 180-day period. Stays are tracked using passport stamps, so it’s important to plan visits carefully to avoid overstaying.[4] The cost of living has also risen in some EU countries, and a few have changed tax rules for UK citizens.

Finding The Right Property Management

If you can’t visit regularly, a trusted local contact or professional property management company can help keep your home safe and well maintained. They can check the property, handle any issues, and even manage rentals if you choose to let it out.

Unoccupancy Period For Your Insurance Policy

Some holiday home insurance policies have rules about how long a property can be left empty. Check your policy details so you know you’re still covered during gaps between visits.

Benefits Of Buying A Property Abroad

Owning a holiday home overseas can offer several advantages:

• Prices can be cheaper: In some countries, property prices are lower than in the UK, especially if you find a location that’s a little off the tourist trail.
• Source of income: Renting to holidaymakers could bring in extra income to help cover running costs.
• Long-term investment: If property values rise, you may make a profit when it’s time to sell.
• Holidays on demand: With a second home, you’ve always got a place to escape to, whether it’s for a short break or an extended stay.

H3: Help Protect Your Investment

If you decide to buy a holiday home abroad, it’s worth considering insurance to help protect your property. This could cover risks like damage, theft, or liability, helping to give you extra peace of mind whether you’re there or not.

At Intasure, our UK-based team of advisors are on hand to help you find suitable holiday home or holiday let insurance. We’ll work with you to advise on the level and type of cover available, helping to ensure your holiday home is protected. Here’s what you can expect from us:

• 20 years of experience in handling home insurance

• No additional administration fees are charged in the event of cancellation

• In-house claims team

• Rated as ‘Excellent’ on Trustpilot* 96% of our customers recommend us on Reviews.co.uk

To get an instant quote, fill in our online form or give us a call on 0345 111 0680.

[1] https://www.mfsuk.com/first-time-landlord-buy-to-let-mortgage/

[2] https://www.studiolegalemetta.com/legal-questions-and-answers/italian-tax-code-codice-fiscale/

[3] https://www.aplaceinthesun.com/articles/2025/01/10-best-places-to-buy-abroad-2025

[4] https://www.gov.uk/travel-to-eu-schengen-area