One case is Egypt where some agents are using the lack of inheritance and capital gains tax as a marketing point. But what is not clear in their claims is that this is true only if you are a resident in Egypt. If you are, for example, a UK resident and buy a property in Egypt to use for holidays or to rent out, then you are not an Egyptian resident and therefore you will not be subject to its tax laws but to those of the country which is your main residence.
But still people are confused. At least the question is asked on the propertycommunity.com forum where property investors are reminded that it is also down to your own personal circumstances.
However, the way these so called 'advantages' are advertised is regarded as 'misleading' and 'crafty' by a number of posters. Yet people still buy without being clear about these kinds of issues. On another post on the same forum a would be investor who is about to put a deposit down on a property in Turkey asks if anyone has information on capital gains tax, title deeds and stamp duty.
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At least they are checking it out before putting down a deposit. But another aspect is worrying. This buyer declares they are about to put down a deposit but have never visited Turkey before!
The forums are useful for highlighting problems that can affect many real estate investors and there is a good example on the propertysecrets.net forum regarding developers refusing to sign the final purchase contract.
In one example investors in Silesia apartments in Poland are being asked to sign a 'waiver of claims' which would allow the developer to swap parcels of land with the local council. 'There is nothing in the purchase contract which allows them to do this and even though we have paid the developer in full, they will not sign. We are left with either paying more legal fees to investigate and undertake the waiver or head towards court proceedings,' states poster Nick Bennett.
In another quite unusual case an Australian investor in the Southbank development in Krakow has made full payment to the developer and owns the apartment and a separate parking space. The developer owns the road to the development and wants to transfer a share of the road to all the investors.
But as a non EU citizen this investor had to apply to the Ministry for a permit to own the land and the application was rejected on the grounds that he did not work, live or have any business in Poland.
'I had purchased the property purely as an investment and do not have any ties with Poland. If there were going to be problems why was I not made aware of this prior to purchasing or at the very least before full payment was made?' he asks.
Now this is not the sort of issue that most foreign real estate investors would think to ask and it highlights an interesting conundrum. But it also shows the need to get independent legal advice especially if you are a non EU investor.
To get back to the original point about small print this is highlighted on the calabriahomes.com forum which points out the fact that you have the right to add or take away certain parts of the contract and you don't have to accept it as it is offered so it is best to iron problems out at the beginning as once it is agreed it is legally binding.
And it is worth mentioning that this applies to the developer as well as the buyer. But of course it is essential to get the contract translated if you are not fluent in the language of the country where you are buying.
