Navigating the Risks of Buying Property Abroad

Author: James Puddle, Head of International Residential, South East Asia, JLL

Investing in overseasresidential real estate offers compelling prospects. From access to education in Australia to opportunities in Japan and lifestyle retreats in Thailand, crossing borders also means navigating unfamiliar laws, tax regimes, currency fluctuations, and regulatory nuances. For prospective buyers, understanding these pitfalls is essential to ensure a smooth buying process and protect one's capital.

Each market has its ownownership rules. In Japan, freehold ownership of land and buildings is permitted. Yet, buyers must engage local counsel to examine the title deeds and ensure compliance with clear zoning regulations. In Thailand, foreigners may hold up to 49 per cent of condominium floor space. They cannot own land outright, necessitating leasehold arrangements or Thai‐entity structures. The United Kingdom offers both freehold and leasehold options (typically 99 to 125 years) and imposes stamp duty land tax, which varies by purchase price and the buyer's residence status (UK Stamp Duty). Failing to grasp these distinctions can result in unexpected costs or even prevent one from registering their interest.

Taxation and Fiscal Pitfalls
Tax regimes differ sharply.In Spain, buyers can face purchase taxes up to 11 per cent, plus annual property levies; in Australia, foreign purchasers pay additional surcharges of up to 8 per cent in some states. Capital gains tax on resale also varies. UK rates, for instance, range from 18 per cent to 28 per cent for foreign individuals. Double-taxation treaties can mitigate exposure, but only if investors obtain proper tax advice both locally and at home. Overlooking these nuances has trapped many first time buyers in unexpected liabilities.

Currency and Financing Risks
Exchange-rate volatilitydirectly affects purchase costs and mortgage repayments. A substantial yen depreciation, for example, recently made Tokyo properties 6 per cent more affordable in yen terms year-on-year. Still, rapid swings can just as easily erode value. One thing buyers can do is explore multi-currency accounts or forward-contract hedges to lock in rates. Financing abroad often requires larger down payments (typically 30 to 50 per cent for non-residents) and some familiarity with local lending practices. Pre-approval from international banks or specialist mortgage brokers can streamline the process and avert last-minute funding shortfalls.

Regulatory and Market Timing
Condominium oversupply incore urban markets (for example, Bangkok, Ho Chi Minh City and Metro Manila) has led to prolonged sales cycles and price corrections (The Business Times, May 2025). While buyers in these cities have strongernegotiating power, they must verify the developer's track record and occupancy rates.

By contrast, hybrid-workdestinations like Phuket and Penang offer better end-user alignment but may lack established resale markets. Timing your purchase to coincide with project completion—and attending events like the Global Property Expo | Singapore 2025—can provide clarity on delivery schedules and real-time market sentiment.

Organised by JLL, talks at the Expo will equip buyers andinvestors with expert guidance. For example, Jeffrey Lee of Charles Russell Speechlys leads a spotlight session on "Cross-Border Property Law and Ownership Structures," which will unpack the tax implications of investing in the UK. Another session, "Residential Investment 101: A Beginner's Guide," which will be moderated by Jennifer Chia, Partner at TSMP Law Corp, will cover matters for new buyers, like legal implications, new financing avenues for non-residents, and the importance of factoring upfront costs (including stamp duties), and consideration of planned exit strategies. Furthermore, a fireside chat with a seasoned buyer and panel discussions featuring expert advisors will highlight "what I wish I knew"—from hidden taxes to title deed surprises—offering real-world lessons to novices.

Legal advisors and financial institutions will be on handthroughout the three-day event. For example, sponsors HSBC and UOB, and a mortgage specialist for the USA, Global Mortgage Group, will be present to discuss bespoke tax planning, mortgage structuring, and regulatory compliance. Knowledge can prevent costly oversights and provide a roadmap for every stage of the buying process, from contract negotiation to property handover.

Overseas property investmentneed not be a leap into the unknown. By arming themselves with local legal counsel, tax advisory services, currency hedging tools, and market intelligence—and leveraging the targeted sessions and expert advisers at the Global Property Expo—investors can confidently navigate the complexities of international real estate. The proper preparation transforms potential risks into manageable steps, ensuring that owning a home abroad does not become a costly lesson.

About James Puddle

James Puddle leads International Residential for South East Asia at JLL Singapore,connecting high-net-worth investors with premier residential developments across the
region. Before joining JLL in 2023, he founded One Global Group, expanding the boutique
project-marketing agency from Singapore to Hong Kong, Malaysia, the Middle East and
Africa after nearly 12 years marketing UK residential properties to international buyers. He is
the organiser of the upcoming Global Property Expo in Singapore, 18-20 July 2025.