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Purchasing real estate in Europe and particularly in Slovakia.
More and more people around the world are realizing the potential of buying property abroad, and are choosing to take the step and explore the field. For those of you who are interested, at TOGETTHERE we recommend starting to invest in Eastern Europe in general, and in Slovakia in particular. The attached article here focuses on a variety of tips, moves, and steps you need to take in order to make a good real estate deal in Europe.
Why is buying property in Europe, especially in Slovakia, profitable?
There are two main reasons for this. The first is a stable economy, and real estate that appreciates in a stable manner. For example, this year alone, real estate in Bratislava has appreciated by 19%. Therefore, buying property in Europe is almost always a safe investment. Second, Europe is a small and relatively close continent, so the property you buy will be close to you, just a few hours away by plane, both from Israel and from anywhere else in Europe. For example, if we talk about Slovakia, it is a country located in a central position in Europe and bordering several countries: Poland, Hungary, the Czech Republic, and Austria.
If we return to the example of Slovakia, the stability of the economy affects the stability of apartment prices: real estate prices there are constantly rising at a steady pace. In recent years, Slovakia has been among the leading countries in the European Union in terms of annual economic growth, with an annual growth rate of 1.5% to 2.4%, making the country attractive for real estate investment by foreign buyers, both large investors and private individuals who want to buy an apartment in Europe. At the beginning of 2022, real estate prices in Slovakia rose significantly, but there is currently a certain decrease in demand. This could be your opportunity to enter the market and buy property abroad.
The most significant price increase was, as usual, in Bratislava, the capital city. Especially, small apartments – studio and two-room apartments – have become more expensive. However, the prices are still far from real estate prices in Israel.
As a capital city, Bratislava currently attracts many students from around the world, as well as international companies such as Amazon, IBM, Booking.com, and UBER, which have branches located here, making the Slovak capital a place where many professionals from different countries come to work and rent apartments. So you won’t have a hard time renting an apartment if you want to buy it as an investment. All of these details suggest that buying real estate in Europe is a profitable deal that will bring you a decent financial profit.
What should you do when deciding to purchase real estate in Europe?
Before proceeding with the transaction, the first thing you need to do is thorough research. This research should include a wide-ranging market analysis, such as examining supply and demand, recommended neighborhoods, apartment prices in different areas, and more. The more you invest in this stage, the better you will know what you are getting into.
There are two options for conducting this research. One is to do it yourself if you have the necessary tools and expertise, or alternatively, to seek the assistance of a company with experience specializing in real estate for years. At TOGETTHERE, we would be happy to assist you in providing information on purchasing real estate in Europe. As part of our services, we provide legal advice, financial management options, and if necessary, we can also provide an architect or engineer to accompany the project professionally and express their opinion.
If you feel inexperienced in this field, or if this is your first time investing outside the borders of Israel, note that you need to research and learn much about the entire process of purchasing real estate in Europe before proceeding with the transaction, even details that may seem insignificant to you. For example: you must check whether a special permit is required to purchase property if you are not a citizen of the country, how to legally register a property in a different country, and if there are any implications for owning property abroad. In addition, you need to find out who conducts financial transactions, who the partner banks are, and even how to know if someone is deceiving you because you do not speak the language.
Furthermore, one of the critical things to remember before and during the purchase of real estate is to document all the details on paper in an orderly manner and not to leave anything in the air or rely on word-of-mouth. Be sure to formulate a clear and explicit contract that includes all the necessary details for both parties, and seek the assistance of a local speaker if needed. Read every document you receive regarding the property, go over it several times, and make sure nothing appears that you do not understand.
Financially, as part of considering entering into a specific transaction, you need to take into account that on every purchase, you will have to add tax at the time of purchase, sale, or holding. This is a non-negligible sum that you must acknowledge, which sometimes may cause you to forego a transaction because it is not economically feasible. Regarding mortgages, remember that the terms offered are different from what you know in Israel, especially if you are not a citizen of the country. Therefore, it is advisable to consult with an expert who is familiar with the laws and local language and can summarize the available options for you in different banks and recommend which bank is worth taking a mortgage from and for how long. We at TOGETTHERE would be happy to provide you with an accountant and a lawyer who have experience in the real estate field and can assist you.
What should you do after purchasing the property?
After buying the property, three options are available to you. The first is to leave it as it is. The second is to expand it, and the third is to renovate it from scratch. Once you have decided what you want to do, you need to check the implications of this regarding costs, registration, professionals, and more so that you do not incur unexpected expenses.
Also, regarding the use of the property, several options are available to you. The first is to live in the property. In this case, you must find out if there are any ancillary payments per month, such as property tax or homeowners’ association fees. And if you choose to rent the property you purchased and not live in it, you need to be familiar with the laws and rights in that country designed to