Whether it’s a holiday home by the sea, a base in another city for when you’re away on business or a flat for one of your children studying overseas, more people are buying property abroad than ever before. There’s a lot to think about, and to help you consider what’s important, we’ve focused on four of Europe’s most popular countries.

Investing in commercial real estate comes with many of the same challenges. Yet our experience suggests it’s easy to overlook some of the practical implications when buying property for personal use. For instance, you could have to pay local taxes or leave your family exposed to unexpected inheritance laws.

To make sure your property dreams don’t turn into an unpleasant nightmare, you might want to think about the following:

  • Are you going to use the property yourself, rent it out or both?
  • Will you finance the purchase with a loan or your own funds?
  • Do you intend to pass on the property to someone else during your lifetime?
  • What kind of governance structure would you like to put in place in case something unexpected happens to someone in your family?

Here are some of the practical issues to consider when buying a residential property overseas:

  • How easy is it to get there?
  • Are your family interested in the location?
  • Is the legal system robust?
  • Are there local services available to manage and maintain the property?
  • What are the likely travel and maintenance costs?
  • What are the local taxes, ownership rules and inheritance laws for foreign owners?


A chalet in the Alps, a villa on the Riviera, a chateau in Burgundy or a pied-à-terre in Paris. France offers a rich variety of real estate opportunities, but the country’s tax and inheritance laws can be complex to navigate. One route is to purchase property through a corporate structure, and there are various options available.

It’s important to make the right choices at an early stage. Your decisions can have significant consequences for your tax liabilities, and make it difficult for you to pass on the property in the way you would like.

Under international private law, there is a difference between holding immovable properties (direct holding) or movable properties (indirect holding through corporations). Legally, managing a property collectively is strictly different depending on whether it is between partners or joint owners.


Spain offers diverse real estate investment opportunities – from the North Cantabric, Atlantic and Mediterranean coasts to the Balearic and Canary Islands, and the dramatic landscapes in the Pyrenes, Castilla, Extremadura and Andalusia.

The country remains one of Europe’s top tourist destinations for its culture, food and weather as well as for those who enjoy golf, sailing and polo. Meanwhile, Spain is also becoming popular with investors, particularly those from outside Europe, who are attracted to its golden visa programmes.

Acquisitions are ruled by civil law and the process is formal and handled through a contract containing all the terms and conditions that must be signed in the presence of a public notary. The deed of sale is then lodged before the Official Land Registry. Typically, buyers and sellers enter into a pre-sale agreement. Considering the complexity of these transactions, local legal advice is highly recommended.


The Italian real estate market is attracting significant interest, particularly from wealthy foreigners looking for holiday homes. A favorable tax regime also makes investing in Italian property appealing.

As in other civil law countries, Italy requires all agreements for selling property and creating property rights to be formally written. Regulations are mainly contained in the Italian Civil Code (ICC), but other specific rules may apply. When buying real estate in Italy, the buyer will first sign a preliminary agreement, which can be drawn up by the seller, agent or a lawyer.

The preliminary contract can be a buying proposal called a compromesso, which legally binds the buyer to the purchase. It can be registered in order to give the buyer a guarantee that no one else will be able to claim rights on the property after the registration and before closing the transaction.

Most Italian properties are freehold, meaning ownership is held in perpetuity. A deposit (caparra confirmatoria) of about 10% is usually sufficient and is paid to a notary. If the seller decides not to sell after signing the preliminary contract, they must return the deposit to the buyer and pay them the same amount again as compensation.

Properties in Italy can be purchased, sold and inherited at favorable tax rates, most of which also apply to foreign investors. For example, there is no capital gains tax for individuals after five years of ownership, and 4% tax on cadastral values (which tends to be much lower than the market value) on direct succession.


Wealthy people have long seen Switzerland as an attractive place to own a second home. From the shores of Lake Geneva to world-famous ski resorts, the country has a lot to offer including high standards of living, a secure and politically stable environment, a central European location and a favorable tax regime.

Although part of the Schengen area, Switzerland is not a member of the European Union (EU) and there are tight restrictions for foreigners looking to buy residential property. The process is governed by specific provisions (so-called “Lex Koller”) for non-Swiss nationals. Cantons can have a law permitting foreign ownership of vacation properties and clearly defines the regions where these acquisitions are possible.

These restrictions do not apply to Swiss citizens and by extension also to citizens of the EU and European Free Trade Association (EFTA) member states living in Switzerland (with “B” or “C” residence permits) as well as citizens of other countries with “B” permits. However, the introduction of the so-called “Lex Weber” law in January 2016 has made it harder for anyone to buy second homes in Switzerland by imposing quotas and construction restrictions.

If you’re interested in buying a residential property in Switzerland, it’s essential to review its legal status at the start of the process with a local Avocat or Notaire. For those who are successful, there are many benefits. By international standards, inheritance tax is very low or non-existent. Transfers between spouses are usually exempt as are most of those to children, although this situation can vary by canton.

Please contact your J.P. Morgan Advisor if you’d like to discuss the outlook for property in these markets, or our Mortgage Team who can help arrange financing in any of these countries and beyond.

It’s important to make sure you’re well advised when making important property decisions, and selecting the right team of professionals (including a notary, lawyer and accountant) is essential.

Please contact your J.P. Morgan Advisor if you’d like to discuss the outlook for property in these markets, or our Mortgage Team who can help arrange financing in any of these countries and beyond.



All market and economic data as of March 2019 and sourced from Bloomberg and FactSet unless otherwise stated.

We believe the information contained in this material to be reliable but do not warrant its accuracy or completeness. Opinions, estimates, and investment strategies and views expressed in this document constitute our judgment based on current market conditions and are subject to change without notice.


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