Most of the time when people decide to buy a home, they usually gravitate toward waterfront/ocean-view properties.
And why wouldn’t they? Whether for a vacation home or real estate investment, this type of property is clearly a better choice for obvious reasons.
However, there are some important aspects that you need to consider before buying an ocean-view property in a foreign country. Otherwise, you won’t be able to make a sound purchase decision.
With that said, let’s dive into this article and discuss what you should look for before buying an ocean-view condo.
Differences Between Buying Oceanfront Properties Vs Traditional Properties
It goes without saying that buying an ocean-view condo is quite different from buying traditional inland properties in foreign countries.
Coastal properties come with unique benefits and appeal. However, they also carry additional challenges. Such as:
- Exposure to weather elements.
- Higher maintenance costs.
- Potential vulnerability to natural disasters like hurricanes.
You don’t have to worry about any of these if you want to buy an inland property.
Nonetheless, while traditional properties may be closer to urban conveniences and offer more predictable maintenance, oceanfront condos provide the allure of waterfront living.
Oceanfront real estate also tends to appreciate faster due to limited supply. According to a report from Zillow, waterfront homes in the US cost more than double the price of inland properties.
Image Source: Zillow
For foreign buyers, it is also important to note that condos and townhouses are not the same. You’d only own the unit's interior and don’t have to worry about exterior maintenance if you go for an ocean-view condo.
8 Things to Consider Before Buying an Ocean-View Condo
At first, purchasing an ocean-view condo might seem like a thrilling opportunity. But it requires careful planning and consideration, just like any other real estate investment.
From understanding foreign ownership laws to evaluating market conditions and hurricane risks, there are numerous aspects that can impact both the value of the property and your experience as an owner.
Here’s what to look for when buying an ocean-view condo in a foreign country:
1. Location and View
The first thing you need to consider is the location of the ocean-view condo.
Not all waterfront properties are built the same. And I’m not talking about the structural aspect. I’m referring to where it is built and the amenities its proximity offers.
For instance, the ocean-view homes in Venice, Los Angeles CA are great options for families due to their proximity to urban centers. They also offer easy access to daily conveniences and transport hubs like airports.
On the other hand, the waterfront properties in Boca Raton, Florida are a fair bit distant from the main city. Therefore, these might be more suitable for vacation homes or single families.
And that’s not all!
Not all ocean views are the same either. Based on the position of the condo within the building, some units may offer partial ocean views, while others boast an unobstructed, panoramic display of the ocean.
Even the pricing can vary depending on this aspect. Properties with scenic views, like the ocean-view condos in Hilton Head Island, typically range around $300,000 to $2,000,000, with an average price tag of$765,000. (Source: HiltonHeadRealtySales.com)
Pro tip: You should confirm from the real estate agency that no future construction projects will block your view before buying the condo.
2. Foreign Home Ownership Laws
It is no secret that different countries have varying restrictions on foreign ownership.
Some allow full ownership, while others offer only leaseholds or place caps on the percentage of properties foreigners can own.
For example, almost anyone can buy a real estate property in the US, regardless of their immigration status or nationality. However, the FL SB 264 Law in the state of Florida prohibits foreign bodies from certain types of real estate ocean-view properties. (Source: The Fund)
That’s why you need to consult with a local real estate attorney beforehand to understand whether the property is legally available for purchase or not. If so, what might ownership entail?
3. Property Taxes and Regulations
Depending on the country, property taxes for foreign buyers can vary a lot. Some nations impose higher taxes on non-residents or require additional fees for coastal properties due to the desirability of oceanfront real estate.
Not only that, but the taxation and other proceedings also need to be done through proper channels.
Let’s take the US for example.
Foreign property buyers in the United States need to file annual tax returns through the Internal Revenue Service (IRS). They also have federal tax/estate tax, especially for luxury ocean-view condos. (Source: List Globally)
Hence, you need to research any local regulations that may impact your ownership. That includes zoning laws or restrictions on short-term rentals if you plan to rent the property.
You can find all the taxation rules and regulations on the internet for the country of your choice.
4. Security and Amenities
Although it’s not very common, coastal properties can be more vulnerable to security risks, especially during peak tourist seasons.
As a result, you should ensure beforehand that the ocean-view condo is in a safe area and inquire about security measures like gated access, 24-hour security, or surveillance systems.
But wait, there’s more!
Whether you’re buying the house as a vacation home or for investment, you also need to evaluate the available amenities.
You need to ask the real estate agent a few questions, like: does the condo building offer pools, gyms, or concierge services?
Or, how are the commute and local recreational facilities?
5. Hurricane Risks
One of the biggest risk factors for oceanfront properties is natural calamities like hurricanes, flooding, and storm surges.
According to a risk report in 2023, around 7.5 million coastal homes in the US are at risk of natural disasters like storm surges or hurricanes.
Hence, you need to research the region’s weather patterns and natural disaster history. You should also keep an eye on how these factors could impact property maintenance and insurance premiums.
Not only that, you also have to ensure that the building is designed to withstand extreme weather conditions, including reinforced windows and storm shutters.
While you’re at it, investigate the property’s insurance policies and coverage limits for natural disasters.
6. Market Condition and Financing Options
Keeping an eye on the market trends is another major aspect of a successful property purchase. You may pay more than the property’s worth during the peak seasons if you’re not aware of it.
This is more common for ocean-view properties as those are more gravitated towards tourism. And a market driven by tourism will experience seasonal fluctuations, affecting property values.
So you need to follow the property trends to purchase a house in a foreign country at the right time.
Furthermore, research the local real estate market to understand if it’s a buyer's or seller's market.
Not to mention, as a foreign buyer, securing financing can be more complex and daunting.
Some countries have limited mortgage options for non-residents, and you may need to explore financing options in your home country.
Fortunately, foreign buyers/investors can get a US mortgage even when they don’t have a US credit history. (Source: American Mortgages)
And the story doesn’t end there!
Exchange rates can also play a crucial role in determining the actual cost of the property. So make sure to keep an eye on currency fluctuations as well.
7. Community and Culture
You have to understand one thing; purchasing an ocean-view condo in a foreign country also means integrating into a new community and culture. The local lifestyle, population growth, diversity, etc, will play a huge part in purchase value.
And while you’re at it, check if the local customs and values align with your expectations, especially if you plan to live there long-term.
Otherwise, you won’t be able to enjoy such a huge investment.
Not to mention, understanding the culture will also help you plan the renting process of the property and market it to tourists accordingly.
8. Resale Value and Exit Strategy
Luxury properties like ocean-view condos typically offer a much higher resale potential than conventional properties. Unless there’s a huge shift in the global economy or regional issues, you don’t have to worry about your property retaining its value.
If you analyze the property trends from the past couple of years, you’ll notice how the ocean-front property prices are going up instead of down.
Source: Zillow
This is very good news for anyone who wants to make sure they can sell the property later on without any loss.
Keep in mind that some countries, like the US, impose capital gains tax on foreign sellers.
Bottom Line
Buying an ocean-view condo in a foreign country is a huge deal due to all the financial risks. However, if you thoroughly research the local market and consult with experts, you can make an informed decision that will allow you to enjoy your dream coastal property with peace of mind.
And the purpose of this write-up is exactly that!
Anyway, that’s it for today. I hope you’ve found all the answers you were looking for.
Have a nice day!
