Investing in Property Abroad.

Purchasing an overseas property can be a profitable way to invest your money:

• With a wide variety of countries to chose from, you can often take advantage of a favourable market.
• If you hold on to the property until market conditions are most favourable, you can sell at a profit (always consider Capital Gains Tax, or equivalent, as this can vary).
• If you buy to let, the property can yield a monthly rental income.

When buying for investment, it is important to answer a number of key questions:

Can I afford the initial investment?

To work out how much you can borrow, use our mortgage calculator.

Will I make a rental profit?

Research average rental incomes for the area and make sure it will more than cover your mortgage repayments and expenses (like local rates, management fees and insurance).

Speaking to local rental agents will help to give you an idea of local occupancy rates and realistic rental incomes.

Ask yourself if you are you looking to rent to holidaymakers or the local market, and whether the property you are buying will appeal to them.

Your exit strategy is the most important thing to consider as an investor, so how quickly would your property sell and who would buy it (i.e. local or foreign buyers)?

Can I sell at a profit?

Over the long-term it is likely the value of your property will increase. Research historical price trends (from the Land Registry or National Statistics Offices) and find out where demand will come from.

To make it more likely that your property will increase in value, buy in locations where there is local demand for property. Try to buy where there is a mature resale market.

How much tax will I have to pay?

Check local property tax laws and ensure you know the levels of tax you'll be paying on rental profits, capital gains, etc. If you're living in the UK, you will need to pay UK taxes on the income as well, but you might be able to apply for double tax relief.

If you're a Lloyds TSB International Account customer, you can get individual tax advice through our partners.

Is my property ready to be let?

If your property needs some work, or requires furnishing, make sure you get in touch with contractors for a quote before you buy.

How safe is my purchase?

When buying property overseas, it is vital that you get the advice of an independent lawyer who is familiar with the purchase process in the country, can check the title deed and ensure due diligence is carried out on the property being purchased. A lawyer can also tell you what your local requirements are (eg insurance and maintenance) and help with translations so that you know what you are signing. Choose a lawyer who represents your interests, and only yours.

Letting a buy-to-let property needn't be complicated, but it does involve a lot of planning. Ask yourself:

How will I find a tenant?

Finding a tenant will depend on whether you are looking to rent to holidaymakers or the local market. A good first step is to contact local estate agents, letting agents, holiday companies and tourist boards. Many first time landlords opt to rent to family and friends, but a good letting agent can ensure your property yields the most profit.

Who will manage the property?

If you are not resident in the country, and don't speak the language, it may be easier to put your property in the hands of an agent. They will organise contracts, resolve any issues with your tenants and oversee the property in your absence. Compare local agents by sourcing testimonials from former clients — ideally ones in the area.

Do I want to let long-term?

If your property is in a popular holiday destination, you'll probably get better rates letting out by the week to holiday makers — but you will have more trouble finding tenants out of season. Think about who is likely to rent your property, and base your rental strategy on this.

At Lloyds TSB International, we arrange mortgages for a variety of applications in a range of countries. See the International Mortgages country list.

We can arrange a mortgage for a particular property, or give you a decision in principle to help you strike a deal with sellers and estate agents.

To check you're eligible for an international mortgage and start the application process, go to ready to apply.

For more information about the process, call or contact us online.

You'll probably receive your rental income in local currency. To make it easy to access the money wherever you are, open a Lloyds TSB International Account.

Lloyds TSB Offshore was named Best Overseas Mortgage Lender 2 years running (2007-2008 and 2008-2009) by Your Mortgage.

We offer flexible international mortgages at competitive rates of interest. See our rates, charges and conditions.

You can alter your mortgage to suit changing circumstances by switching it between the currency of your main earnings and the currency of the country your property is located in.

With the support and security of a trusted British bank, you can feel confident that you're protected against local financial instabilities.

See more reasons to choose Lloyds TSB International.