This is the first in a new series where our Portugal-based attorney, Shannon Brandao, will guide you through the practical, legal, and personal considerations of purchasing a home in Europe.
More and more Americans are thinking about moving to Europe. Though the number that pack up and ultimately move is still relatively small, it’s quickly growing due to a variety of factors, like the availability of remote working, the cost of living, and the “toxic” political climate.
Increasing numbers of Americans are resettling in the Netherlands, Spain, Portugal, and the UK. But France, Germany and Scandinavian countries are also seeing new influxes.
The number of Americans buying real estate in Europe is also rising. According to Coldwell Banker’s 2023 Global Luxury Report, high net worth individuals from the U.S. are showing “significant interest in overseas home purchases.” The U.K., Switzerland and France were among their top secondary-home destinations.
But it’s not just the ultra-wealthy who are shopping for property in Europe.
Middle class Americans, too, are using the proceeds from the sale of U.S. real estate or obtaining second mortgages to buy cheaper homes across the pond. Some even pool savings to buy stakes in European vacation houses.
Flexible immigration policies offered to attract talent and investment have made these real estate purchases increasingly doable. There are new visas in Europe for skilled workers, digital nomads, investors, and, even, retirees whose passive income meet minimum thresholds.
Although the Golden Visa track, where citizenship is offered in exchange for a significant, lump-sum real-estate investment – usually €500,000 or more – is on its way out in Europe, there are still many options that open a path to permanent residency and citizenship. The differences are usually in the amount of money an applicant needs to qualify and the length of time the visa-holder must remain in the country.
New visa opportunities have also spawned a cottage-industry of consultants and Youtubers who offer DIY advice. We strongly advise against applying for a visa and purchasing real estate in Europe without legal help.
Each European country has different immigration, real estate, contract, inheritance and asset protection laws, as well as different procedural processes that can dramatically impact your property purchase. Laws can also shift quickly with changes in political leadership and policy.
Real estate purchases abroad for non-citizens are also more complex in European countries and municipalities whose regulations, bureaucracies, and service providers are unaccustomed to the trend. There are even cultural differences in the ways properties are shown to potential buyers, as well as more limited financing options for foreigners.
Of course, depending on where you choose to buy there will probably be a language barrier, and don’t forget that the homes, themselves, are constructed with different materials and building standards than what is used in the U.S. Knowing what you don’t know about local quality and construction habits can mean the difference between buying a home you can comfortably update and maintain and buying a money pit. Good legal representation will always insist on independent building inspections.
Put differently, sourcing “free” information on complex legal issues like immigration and purchasing real estate in a foreign country – tempting as it may be – is likely to fall far short of supporting your individual financial, legal, and personal needs. No matter how many “satisfied” commenters attest to the advice given, never forget that there’s someone responsible for maintaining the page or group who can censor unwanted news and reviews – usually a moderator with some other product to sell who has no legal or fiduciary obligation to you.
And that can cost you many times the going legal rate in the long run.
While it’s true that experiencing the ups and the downs of buying real estate in Europe is part of the adventure, you can do a lot to ensure your purchase is a good one. The right preparation will help you avoid costly mistakes and negative experiences that can make you regret your purchase and the decision to move to Europe.
In this series, we’ll dive headfirst into the practical, legal, and personal challenges of purchasing a home in Europe. We’ll start by figuring out where (and how) you want to live in Europe. Then we’ll discuss the various types of visa offerings, the purchase itself, as well as tax and inheritance considerations.
Through it all, I’ll share my own experiences living in Europe (Portugal) as an American immigrant and purchasing my first property in Portugal. Feel free to contact me with individual questions or with an idea for a post that will help you plan an international move to Europe.
