Buying Property Abroad: A Foreigner's Legal Checklist

What does 'real estate' legally include?

Real estate legally includes land, anything permanently attached to it (like buildings or structures), and certain rights connected to that land, such as the right to use, lease, or extract resources. It is different from personal property, which covers movable items like furniture, vehicles, or equipment.

Lawyers often talk about "real property" rather than "real estate," but in daily use these terms largely overlap. Real estate law deals not only with the physical land and structures, but also with the legal interests attached to them, such as easements, mortgages, and leases. Understanding what counts as real estate helps you know what you are actually buying, selling, or leasing.

Core elements of real estate

• Land: The surface of the earth in a defined area, often identified by legal description or parcel number.
• Improvements: Permanent structures attached to the land, such as houses, apartment blocks, offices, warehouses, roads, wells, and fences.
• Fixtures: Items originally movable but now attached in a way that makes them part of the property, like built-in cabinets, central air systems, or wired lighting.
• Rights to the land: Use rights, development rights, mineral rights, air rights, and easements (rights of way, utilities, access routes).

Real estate vs personal property

Why this matters in practice

• Disputes often arise over whether an item is a fixture (included in the sale) or personal property (taken by the seller).
• Different transfer procedures and taxes apply to real estate vs personal property.
• Mortgages and other security interests typically attach to real estate and fixtures, not personal items, unless specifically agreed.

What legal rights come with owning real estate?

Owning real estate generally gives you a "bundle of rights," including the rights to possess, use, exclude others, lease, sell, mortgage, and sometimes develop the property. These rights can be limited by law, contracts, and public regulations such as zoning or environmental rules.

You rarely hold every possible right absolutely. Instead, your rights are shaped by the type of ownership you have, any contracts you sign, and any rights that others already hold in the same property, such as easements or leases.

The main "bundle of rights"

• Possession: The right to occupy and control the property, subject to any existing leases or rights of others.
• Use and enjoyment: The right to live in, run a business from, or otherwise use the property, within legal and contractual limits.
• Exclusion: The right to keep others off the property, except where law or agreements allow access (for example, utility workers, easement holders).
• Transfer (alienation): The right to sell, gift, or otherwise transfer your interest to someone else.
• Encumbrance: The right to use the property as security for a loan (mortgage) or grant easements or covenants affecting future use.
• Income: The right to receive rent or other income generated by the property.

Typical limits on ownership rights

• Zoning and planning laws: Control what you can build or how you can use the property (residential, commercial, agricultural).
• Environmental rules: Restrict activities that harm the environment, such as pollution or tree removal.
• Building codes and safety laws: Set standards for construction, renovations, and habitability.
• Private covenants or community rules: May limit appearance, use, or alterations, especially in condominiums or gated communities.
• Existing rights of others: Tenants, easement holders, or neighbors may have legally enforceable rights that reduce your freedom of action.

How do common forms of real estate ownership differ?

Common forms of real estate ownership differ in who controls the property, who inherits it, and how liability and taxes apply. The main structures include individual ownership, co-ownership (such as joint ownership), corporate or entity ownership, condominiums, and long-term leaseholds.

Choosing the right form affects your risk, your estate planning, and how easy it is to sell or finance the property. You should align the ownership type with your goals, family situation, and investment strategy.

Typical ownership structures

Key issues to consider when choosing ownership form

• Control: Who can decide to sell, mortgage, or alter the property, and what approval is required.
• Exit options: How easy it is to sell your interest, and whether co-owners have rights of first refusal.
• Inheritance: What happens on death, especially in co-ownership; whether the share passes to co-owners or through the estate.
• Liability: Whether owners are personally liable for debts, accidents, or defects, or whether liability is limited to an entity.
• Tax and regulatory treatment: Some jurisdictions treat entity or investment ownership differently from personal residential ownership.

How does a typical real estate purchase and sale process work?

A typical real estate transaction follows a sequence: preparation, offer, contract, due diligence, financing, closing, and registration of the new owner's title. Each stage involves specific documents, deadlines, and legal checks that protect both buyer and seller.

Although procedures vary between countries and regions, the same core logic applies: verify the property and the seller, agree on terms, secure the money, sign the transfer instruments, and record the change of ownership in the public registry. Missing a step or deadline can delay closing or create long-term legal problems.

Main stages of a real estate purchase

1. Preparation and search
   • Buyer clarifies budget, financing options, and preferred areas.
   • Seller gathers title documents, plans, and regulatory approvals.
   • Agents or brokers may be engaged, with clear commission terms.
2. Offer and negotiation
   • Buyer submits an offer with price and key conditions (financing, inspections, timing).
   • Seller accepts, rejects, or counters; several rounds may occur.
   • In some places, even an "offer" can be legally binding, so legal review is useful early.
3. Binding contract
   • Parties sign a sale agreement that sets out price, deposit, completion date, and conditions.
   • Buyer usually pays a deposit, which may be held in escrow or trust.
   • The contract defines what happens if either party fails to complete.
4. Due diligence period
   • Title search and review of the land registry for liens, mortgages, easements, and disputes.
   • Physical inspections of the building, systems, and land.
   • Review of planning permissions, zoning, occupancy certificates, and any rental contracts.
   • Buyer confirms financing approval based on the property.
5. Financing and pre-closing steps
   • Final mortgage or loan documentation is agreed and signed.
   • Closing figures (purchase price, taxes, fees, adjustments) are calculated.
   • Parties sign transfer deed and loan documents, often in escrow pending registration.
6. Closing and transfer
   • Buyer pays the balance, often through the lender and an escrow or settlement agent.
   • Seller hands over signed transfer documents and possession (keys, codes).
   • Closing agent or lawyer submits documents to the land registry for recording.
7. Post-closing
   • Land registry updates the public record to show the new owner and any mortgage.
   • Buyer updates insurance, utilities, and, in some cases, community or association registrations.
   • Any post-completion obligations, such as defect rectification or final tax filings, are handled.

Common mistakes in purchases and sales

• Signing binding documents without legal review.
• Skipping full title checks or not understanding easements and covenants.
• Failing to make the contract conditional on financing or inspections when needed.
• Underestimating closing costs such as taxes, registry fees, and professional fees.
• Not aligning the timing of sale and purchase transactions if you are both selling and buying.

What should buyers and sellers check during real estate due diligence?

During due diligence, buyers and sellers should verify title, physical condition, legal compliance, and financial aspects of the property. Systematic checks reduce the risk of hidden defects, boundary conflicts, unpaid taxes, or unauthorized construction.

While buyers usually lead due diligence, sellers can prepare in advance to avoid surprises and delays. Good due diligence can influence price, contract terms, or even the decision to proceed.

Legal and title checks

• Confirm the current registered owner and their authority to sell.
• Identify mortgages, liens, or other encumbrances that must be cleared or assumed.
• Review easements, rights of way, and covenants that limit use or require shared responsibilities.
• Check for pending litigation, boundary disputes, or notices from authorities.
• Verify that any previous transfers were properly documented and registered.

Physical and technical checks

• Full structural and systems inspection by qualified professionals.
• Verification that the building matches approved plans and permits.
• Environmental assessments if there is any risk of contamination or hazardous materials.
• Survey of boundaries to confirm land size and location of fences, walls, and improvements.

Financial and commercial checks

• Assessment of property taxes, service charges, and association fees.
• For investment property, review of leases, rent rolls, arrears, and tenant history.
• Operating costs such as utilities, maintenance, insurance, and management fees.
• Projected income and yields compared with market benchmarks.

How do leases and rental arrangements usually work?

Leases and rental arrangements grant a tenant the right to occupy and use real estate for a set period in exchange for rent and other obligations. They define what the landlord must provide and maintain, and what the tenant must pay, repair, and obey.

Lease terms vary widely between residential and commercial property, and between jurisdictions, but most leases cover duration, rent, deposits, repairs, use, and termination rules. A clear written lease reduces disputes and protects both sides.

Core elements of a lease

• Parties: Landlord (owner or head tenant) and tenant (or subtenant).
• Premises: Exact description of the space, including any parking or storage.
• Term: Start and end dates, renewal options, and any notice requirements.
• Rent and deposits: Amount, payment method and frequency, increases, and security deposit rules.
• Use: Permitted and prohibited uses, such as residential only or specific types of business.
• Repairs and maintenance: Who is responsible for what, including structural elements, utilities, and common areas.
• Utilities and operating costs: How water, power, taxes, and service charges are paid or reimbursed.
• Assignment and subletting: Whether and how the tenant can transfer their rights to another person.
• Termination and default: Grounds for ending the lease, notice periods, and procedures for eviction.

Residential vs commercial leasing

Common landlord and tenant pitfalls

• Using informal or incomplete agreements for significant tenancies.
• Not documenting property condition at move-in, leading to deposit disputes.
• Tenants breaching use clauses (for example, running a business in a residential unit).
• Landlords entering without required notice or failing to keep the property safe and habitable.
• Ignoring local procedures and notice requirements for eviction or termination.

How is real estate commonly financed and secured?

Real estate is commonly financed through loans secured by the property itself, usually by a mortgage or similar security instrument. If the borrower defaults, the lender can enforce its security and recover the debt, often by selling the property.

Financing documents set out repayment terms, interest, security rights, and events of default. Because the stakes are high, lenders require careful due diligence and strong protection, while borrowers must understand their obligations and risks.

Basic structure of real estate finance

• Loan agreement: Sets the amount, interest rate, repayment schedule, and covenants.
• Security instrument (mortgage, charge, deed of trust, etc.): Gives the lender legal rights over the property if the borrower does not pay.
• Priority and ranking: Determines which lender is paid first if there are multiple mortgages or liens.
• Guarantees: Individuals or companies may personally guarantee repayment in addition to the property security.

Key lender protections

• First ranking security over the property registered in the public land registry.
• Insurance requirements, such as property and sometimes business interruption insurance naming the lender as beneficiary.
• Covenants requiring the borrower to maintain the property, pay taxes, and not create further encumbrances without consent.
• Rights to accelerate the loan and enforce security on default, subject to local procedures and borrower protections.

Borrower considerations

• Understanding variable vs fixed interest rates and total cost of borrowing.
• Prepayment rights or penalties if you want to refinance or sell early.
• Restrictions on renting, altering, or transferring the property while the loan is outstanding.
• The risk of losing the property if you miss payments, and whether local law offers any grace periods or restructuring options.

What are the most common real estate disputes and how are they resolved?

Common real estate disputes involve boundaries, defects, unpaid rent, construction issues, and breaches of contract in sales or leases. Most disputes start with negotiation but can escalate to mediation, arbitration, or court action if the parties cannot agree.

The best strategy is early problem spotting and documentation, followed by structured negotiation and, if needed, formal dispute resolution. Delays or informal side deals often make matters worse.

Typical sources of dispute

• Sales disputes: Non-disclosure of defects, missed deadlines, failure to complete, or disagreements about what is included in the sale.
• Boundary and neighbor disputes: Encroaching fences or buildings, shared driveways, noise, and nuisance claims.
• Landlord-tenant issues: Unpaid rent, property damage, access problems, deposit return, and eviction processes.
• Construction and development disputes: Delays, cost overruns, poor workmanship, and failure to meet specifications or permits.
• Association and community conflicts: Violations of rules, unpaid fees, or disputes over decisions of homeowner or building associations.

Resolution methods

• Direct negotiation: Often the fastest and cheapest if both parties stay pragmatic.
• Mediation: Neutral third party helps the parties find a mutually acceptable solution.
• Arbitration: Binding decision by a private decision-maker, sometimes required by contract.
• Court litigation: Formal process to obtain a judgment or order, including eviction, damages, or specific performance of a contract.

Practical tips for handling disputes

• Keep detailed records: contracts, emails, photos, inspection reports, payment proofs.
• Act early when problems arise; do not ignore notices or demand letters.
• Check dispute resolution clauses in your contracts before starting any formal process.
• Assess cost proportionality: some disputes are not worth full litigation, especially over small amounts.

How do real estate rules differ globally between common law and civil law systems?

Real estate rules differ across countries, but broadly, common law systems rely heavily on case law and flexible contracts, while civil law systems rely more on detailed codes and formal registration. Both systems, however, aim to provide clarity on ownership, transfer, and security rights.

In practice, the differences affect how property is registered, how deeds are interpreted, and how much freedom parties have to shape their own arrangements. If you invest or live across borders, you must adjust to local legal culture and procedure.

Common law characteristics

• Strong role for judicial decisions and legal precedents.
• Highly developed concepts of equitable interests, trusts, and flexible property rights.
• Greater emphasis on freedom of contract, subject to public policy limits.
• Title insurance is often common, covering certain risks not caught in registry searches.

Civil law characteristics

• Legal codes set detailed rules on property, obligations, and registration.
• More formal role for notaries or similar public officers in validating and recording transfers.
• A stronger presumption that the land registry is complete and conclusive as to ownership.
• Standardized property forms and rights, sometimes with less use of equitable concepts like trusts.

Cross border considerations

• Foreign buyers may face restrictions on owning certain types of property, especially agricultural or border land.
• Taxation of property, rental income, and capital gains varies widely and may interact with your home country rules.
• Enforcement of mortgages, leases, and judgments can differ sharply between jurisdictions.
• You should use local counsel and advisors rather than assuming your home country practices apply.

When should you hire a real estate lawyer or other expert?

You should hire a real estate lawyer or expert when significant money is at stake, documents are complex, or you face a dispute, regulatory issue, or cross border element. Professional advice can prevent costly mistakes and protect your rights in ways that templates and informal advice cannot.

The more unusual the situation, the stronger the case for getting expert help. For routine or low value matters, you might rely on simpler forms and basic guidance, but you still need to understand local legal requirements.

Situations where a real estate lawyer is strongly recommended

• Buying or selling any property with a high purchase price or complex history.
• Deals involving co-ownership, companies, trusts, or investors.
• Commercial leases, especially long term or anchor tenant arrangements.
• Disputes over defects, boundaries, unpaid rent, or broken contracts.
• Transactions involving development rights, major renovations, or change of use.
• Foreclosure, enforcement of security, or restructuring of distressed property debt.
• Cross border deals where foreign ownership or tax rules apply.

Other useful real estate experts

• Real estate agents or brokers: Market knowledge, pricing, and negotiation, but usually not legal advice.
• Surveyors: Accurate measurement of land and boundaries, assessment of structural issues.
• Architects and engineers: Design, planning, and technical compliance of buildings and alterations.
• Inspectors: Condition reports on structure, systems, and safety.
• Tax advisors: Efficient structuring of ownership, income, and capital gains.
• Property managers: Day to day management, tenant relations, and maintenance for rental properties.

How to work effectively with your lawyer

• Engage them early, before you sign binding documents or pay large deposits.
• Provide complete information and documents, including any prior agreements or communications.
• Clarify your goals and risk tolerance: speed vs security, flexibility vs strict protections.
• Agree on scope and fee structure, and ask for a clear list of tasks and timelines.

What are smart next steps if you are dealing with a real estate issue?

Smart next steps include clarifying your goals, collecting your documents, and getting early advice appropriate to the size and complexity of your issue. You should then map out a simple action plan with deadlines and responsibilities.

Whether you are buying, selling, renting, or resolving a dispute, planning and documentation will save you time and money and reduce stress.

Step by step action plan

1. Define your objective clearly
   • Are you trying to buy, sell, rent, invest, develop, or resolve a dispute?
   • What outcome matters most: price, timing, certainty, or relationship preservation?
2. Gather all relevant information
   • Contracts, deeds, leases, correspondence, plans, and photos.
   • Any notices from authorities, lenders, or associations.
3. Assess the stakes and complexity
   • High value or complex matters justify professional advice and thorough due diligence.
   • For smaller or straightforward issues, use standard forms only if they fit your local law and situation.
4. Engage appropriate professionals
   • Contact a real estate lawyer for legal risk, contract review, and dispute strategy.
   • Use inspectors, surveyors, or engineers for condition and boundary checks.
   • Consider a financial or tax advisor if the investment or tax impact is significant.
5. Create a timeline with key deadlines
   • Note any contract deadlines, financing expiry dates, or legal limitation periods.
   • Schedule inspections, approvals, and signings well before those dates.
6. Document every step
   • Confirm key discussions in writing, ideally by email.
   • Keep copies of all signed documents, reports, and proof of payments.

Real estate transactions and disputes are manageable if you understand the basic concepts, follow a structured process, and seek targeted expert help when needed. A planned, evidence based approach will protect your position and support better outcomes, whether you are a homeowner, tenant, investor, or developer.