The UK housing market is evaluated as being resilient, with a 3+% increase in the first trimester of 2025. However, rising interest rates, tightening regulations, and tax changes are nibbling away at what should be pretty nice profits. 

As a result, many property owners are starting to look elsewhere for better options. But investing internationally brings a whole new set of considerations, such as legal frameworks, tax implications, market volatility, and that not-so-small matter of managing a property thousands of miles away.

In this article, we’ll explore both the benefits of branching out overseas and give you a realistic look at the challenges to watch out for. This way, you’ll be able to make an informed decision.

UK vs Global: A Quick Market Snapshot

Britain’s buy-to-let scene has long been a favourite among property investors, but recent years have brought in headwinds: stricter EPC regulations, a phasing out of mortgage interest relief, and property prices that can make even seasoned landlords wince.

In 2024, average UK rental yields hovered around 4.75%, with London trailing slightly lower. By contrast, cities like Istanbul and Manila deliver upwards of 6 to 8%. At the same time, holiday hotspots such as Portugal’s Algarve offer both lifestyle appeal and strong short-term rental income, particularly through platforms like Airbnb.

Of course, yield isn’t everything. Local economic stability, foreign ownership laws, property taxes, and tenant rights can dramatically affect profitability and peace of mind. Still, the global scene offers room to breathe and grow for landlords looking for better opportunities.

The Upside of Overseas Investments

Investing overseas isn’t only about lifestyle perks; it can also make solid financial sense for UK landlords looking to diversify risk and chase higher returns.

For instance, while UK property, especially in London or the Southeast, can require deep pockets, you can often buy well-located overseas property for a fraction of the cost. In parts of Portugal, Greece, or Turkey, £100,000 can go a long way.

This property investment guide for Greece will give you all the information you need if you want to be one with the sun, the sea, and the olive trees. It’ll also give you an idea of what it means to buy property overseas.

You can also use your newest investment as a holiday home or a future retirement option. After all, if you already own it, why not use it for yourself sometimes?

The Flip Side: Risks and Challenges

No investment is 100% risk-proof, so you have to be aware of the extra hurdles associated with owning overseas property. 

First, there are the legal and regulatory aspects. Every country has its property laws, and they don’t always favour foreign investors. For example, Australians are working on a temporary ban on foreign access to the real estate market.

In some places, you may need to jump through hoops just to own land or let out your property. Also, tenant rights, eviction processes, and landlord obligations can be wildly different from those in the UK.

Then there’s the tax issue. When you buy abroad, you have to deal with two tax systems: local taxes where the property is located, and UK tax on your foreign rental income. Always check if the UK has a double taxation agreement with your target country, and speak to an accountant who deals in international property.

Lastly, there’s the headache of managing a remote property. Unless you plan on flying out for every boiler breakdown, you must rely on local property managers, which can be hit or miss. You’ll have to learn how to vet agents and design clear contracts for everyone involved.

Wrap Up

Overseas property can be a smart move, but only with the right research and risk management. Treat it like a business decision, not a holiday fling, and you could find your next investment gem under sunnier skies.