There is a lot of talk about a possible Brexit and it’s a question that comes up every so often when with those looking to sell overseas property quick. Will there really be an exit? Will Britain really leave the EU, of which it has been a founding member?
There is a hot political debate over the issue in the UK, with the government led by Prime Minister David Cameron more inclined towards staying in the European Union, but with a few conditions. But if Britain were to leave the EU – which is unlikely in our opinion – what would happen to the 2.2 million UK nationals who live in the EU?
After all, Brits are the biggest buyers of overseas property in Europe and over 1 million own holiday homes here. Would there then be a rush to sell overseas property online?
Well, as of now, Brits are as free to live and work in all European Union countries and own property. They are seen as citizens of a fellow EU member state and are come and go as they please. Now, will this change if Britain was to leave the EU?
By law, yes, a lot would change if Britain decides to leave the EU, as the Brits would not be treated as EU citizens and those who wish to buy holiday homes in Spain or France will be treated the same as Chinese or Russian buyers. They would be allowed to live and work in the EU nations and own property there, but with several restrictions.
Of course, the British government would intervene and establish bilateral agreements with countries such as Spain, France, Portugal and Italy to make sure that things don’t change for Brits who property in those countries. But there would b changes for sure. Such as having more questions asked about how long you are going to stay, questions about your income, health cover and more, which you would consider to be intrusive.
Even those looking to be permanent residents would be affected. So currently if you live for over 5 years in an EU state, you can apply for a long-term resident status, as per the EU law. But if a Brexit were to happen, you wouldn’t be seen as an EU citizen and there might be complex integration rules regarding your long term residency, like being able to communicate in that country’s language.
You may be required to file tax returns for the past 5 years, take a driving test in the host country as your UK driving license would not be valid – which are problems you don’t face today as the UK is still very much an EU member state. There could be restrictions on work as well – you may not be allowed to work in certain jobs. Ultimately, the restrictions could force you to return to the UK.
Now, about property ownership – as a UK citizen you are free to own property in any EU nation and have the same property rights as the locals. This is likely to continue, even if there is a Brexit depending on how close the EU nation is to the UK. For example, we don’t see problem with UK nationals owning property in France or Spain after a Brexit.
But there could be complications when it comes to the property inheritance and taxation laws – so this is something you’ll need to worry about, if there is indeed a Brexit. Getting a mortgage to buy a home in the EU could be more difficult as well, as most banks in Europe think twice about lending to non-EU citizens. So getting a mortgage might require more collateral to be deposited.
Now, if Britain does not leave the EU, that would be the best possible outcome for all concerned. However, it is possible that the British government would renegotiate some of the terms of EU membership, which means imposing more restrictions on Bulgarian, Romanian and Polish nationals immigrating to Britain as EU citizens.
So, if you have an overseas property in these countries, you will probably need to worry a bit because there could be some repercussions related to such an action.