Is a cheap European property a smart investment?

I'm retired | | 2 min read



The pandemic, lockdown, and the overall uncertainty of the past 18 months has given people time to think about their priorities. It’s allowed us to step outside our daily routines and figure out what’s really important, and what makes us happy.

For some people that might mean downsizing to a simpler life.

That could mean many different things. One option may be a cheap overseas property that allows you to take life at your own pace while working remotely.

Whether it’s a villa in Italy, a beach front apartment in Spain, or a private island in Sweden, the good news is there’s plenty of affordable property throughout Europe.

With prices starting from around $100,000 AUD, here’s what you need to know about that lifestyle change you’ve been daydreaming about. 

Working remotely

Work used to mean punching in at 8:30am, a hasty lunch, and a long commute home after 5pm. If COVID has taught us anything, it’s that work can be more flexible than that traditional model.

Millions of Australians have been working from home for the last 18 months. While every organisation has its own post-pandemic strategy, it’s unlikely we’ll simply return to normal.

Instead, we’ll probably see a hybrid model, with many business adopting hot desks, and a workforce that only comes in 2-3 days a week. In some instances, the traditional city office will be abandoned altogether, with workers scattered across their suburbs.

In other words, remote work is here to stay. And if you can work from home in Richmond or Marrickville you can probably do the same from an Italian villa or a Spanish island.

Cheap overseas properties

The first thing you notice when you start looking at overseas property is just how affordable it can be. In Australia, we’ve been conditioned to accept that a knock-down terrace in Melbourne or Sydney with no roof or parking is a steal for $1million.

A quick online search shows how high our local prices are compared to some parts of the world. If you’re willing to look outside the capitals you can pick up a small Swedish island for $100,000, a Tuscan villa from $150,000, or an oceanside Spanish apartment for $200,000. In Australian capital cities those prices would be lucky to get you a deposit.

And to be clear, we’re not talking about the crumbling Italian places that you might see advertised for $1 in a remote village. These are perfectly liveable homes.

You can find out more about the practical aspects of European home ownership via various websites and YouTube channels. These can help you navigate things like mortgages, paperwork, residency requirements and work visas.

The paperwork and practical side of overseas properties 

Speaking of paperwork, whether you’re in the market for a southern European villa or a Nordic holiday home, there are certain practical things you’ll need to consider. 

These can be broken down into four key areas:

1. Mortgages and finance

  • Will you be borrowing money from an Australian bank, or a local bank in a foreign country?

2. Property taxes and costs

  • Understanding the purchasing process, the various taxes involved, and how to find a local conveyancer varies from country to country. 

3. Visas and residency 

  • What are the rules around living and working in Europe, including healthcare services?

4. Local infrastructure, living, and resources

  • Basically, will you have reliable internet, do you need to speak the local language, and anything else that might be relevant

Online resources can help you understand the basics for different European countries, but if you’re serious about a purchase you’ll want professional advice on the above aspects. 

A long-term investment

Even if you’re not ready to give it all up for a new life overseas, a foreign property can provide a holiday home and be part of a long-term retirement plan. You may even be able to rent it out via services like AirBNB.

An overseas property also provides options when you are ready to retire. Whether you’re looking to sell-up locally and downsize to the French coast, or just want to spend half the year enjoying a southern European lifestyle, a property in Europe isn’t as far-fetched as it may initially sound.

Now boarding for Europe

The global pandemic has grounded travel out of Australia for the past 18 months. But if the news is to be believed, we might be free to travel again before the Christmas break.

If you’ve been itching to travel, a trip to Europe is a great excuse to do some research, and perhaps check out some local properties while you’re there. Who knows, you may fall in love with a quiet little village, or a coastal town in Spain. 

At the very least, an overseas holiday home may just be the motivation you need to get your finances in order and make sure you’re on track for a comfortable retirement.

Issued by Togethr Trustees Pty Ltd ABN 64 006 964 049, AFSL 246383 ("Togethr"), the trustee of the Equipsuper Superannuation Fund ABN 33 813 823 017 ("the Fund"). The information contained herein is general information only and does not take into account your personal financial situation or needs. You should consider whether this information is appropriate to your personal circumstances before acting on it and, if necessary, you should also seek professional financial advice tailored to your personal circumstances. Where tax information is included, you should consider obtaining personal taxation advice. Before making a decision to invest in the Equipsuper Superannuation Fund, you should read the appropriate Product Disclosure Statement (PDS) and Target Market Determination for the product which are available at  Financial advice services may be provided to members by the trustee’s related entity Togethr Financial Planning Pty Ltd (ABN 84 124 491 078; AFSL 455010). *Past performance is not an indication of future performance.

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