European limitations on foreign property purchases
In Europe, no law prohibits foreign citizens from buying property but certain countries have put limitations on this right, often with regards to residency rights, property type or buyer category. For example, only residents can buy real estate in Iceland and Liechtenstein. In Andorra, Hungary, Denmark, Poland and Malta, foreign investors can only buy property after receiving approval from the local authorities.
Nevertheless, most major European countries (e.g., France, Germany, Italy, Spain and UK) allow overseas investors to buy residential and commercial real estate with the same rights as local citizens.
European countries without property restrictions
Even minor limitations can deter buyers, even if they had their heart set on a specific country, but these restrictions can often be avoided by creating a legal entity for example. The most important thing is to have a reliable guide to help you. This article by Yulia Kozhevnikova, Tranio’s leading real estate expert, is here to do just that.
National security is an important motivation in some countries that have prohibited foreign citizens from buying property in certain regions. In Greece,
National preference is also a European reality and there are countries where whole districts are closed to foreign buyers. Austria is an excellent example as there are limitations on half of the country’s federal states: Burgenland, Vienna, Lower and Upper Austria, Salzburg, Carinthia, Tyrol and Vorarlberg. Switzerland is also a frontrunner for national preference. In addition to extremely strict rules on residency and citizenship, the country has a famously restrictive “Lex Koller” property law, which limits foreign purchases to resort property in specific cantons: Valais, Vaud, Graubünden and Ticino. In Finland, foreign citizens cannot buy property on Åland Islands.
Agricultural land is particularly vital to Europe’s less developed economies in the East and Southeast — particularly in the Balkans and Baltic states. Estonia, Hungary, Latvia, Lithuania and Slovakia have taken steps to prohibit
Construction and surface area restrictions have been imposed in popular countries where development opportunities are limited by the lack of space. These are embodied by laws prescribing the maximum floor space a foreign citizen may buy and how much surface area they may build on. In addition to that, it is not uncommon to need permission from local authorities. In Switzerland, foreign citizens cannot buy property over 200 sq m in size or land exceeding 1,000 sq m. In Montenegro, purchases of land for development may not exceed 5,000 sq m.
Restrictions on companies and individuals
Overcoming restrictions on individuals is often possible by registering property to a company or creating a legal entity to make the purchase.
Restrictions on corporate real estate purchases have been put in place by some states to prevent abuse. In Turkey certain types of legal entities (e.g., funds and associations) cannot purchase real estate, but others can. In Switzerland, foreign companies can buy real estate if they are listed on the Swiss stock exchange and less than 33% of their shares are held by
Restrictions by nationality are less common but do exist. Turkey bans nationals of Armenia, Yemen, Cuba, Nigeria, Syria and North Korea from buying real estate — but they can buy it through a company.
The following table contains these and other limitations not mentioned above.
|Country||Limitations on purchase of land||Limitations on purchase of property||Territorial limitations||Limitations on companies and individuals|
|Albania||Foreign citizens cannot buy agricultural lands but can lease it for 99 years||—||—||—|
|Austria||Land buyers meet one of the criterion:
There are exceptions to these rules that depend on the property
|Property buyers meet one of the criterion:
There are exceptions to these rules that depend on the property
|Croatia||Foreign citizens cannot buy agricultural land, unless they create or buy it through a Croatian company||—||—||—|
|Denmark||—||Foreigners can only buy property as their permanent residence or place of business||—||—|
|Estonia||Only Estonian, EU and EEA citizens can buy agricultural and forest land. In order to purchase more than 10 hectares, permission from the authorities is required||—||Non EU/EEA citizens cannot buy property near state borders. This land can only be owned, with permission from the authorities, by Estonian, EU and EEA citizens, as well as legal entities||—|
|Finland||—||—||Foreign citizens cannot buy real estate on Åland Islands. It is possible only with Åland right of residence, which is given to children of native residents and citizens of Finland||—|
|Macedonia (FYROM)||Foreign citizens cannot purchase agricultural land in Macedonia but can lease it with permission of the Ministry of Justice||—||—||—|
|Malta||—||Special permission from the authorities: Acquisition of Immovable Property Act (AIP Permit). Property value cannot exceed the minimum annual value designated by the National Statistics Office;
||AIP Permit is required for property purchases in all areas, except Special Designated Areas||—|
|Montenegro||Foreign individual can buy up to 5,000 sq m of land with a building; otherwise the land must be purchased in a company's name||—||—||—|
|Poland||Permission from the Ministry of Internal Affairs of Poland is required||
Permission is not required for buyers of separate houses and those who have been residents of Poland for five years
|Romania||Agricultural land property purchase by
|Russia||Foreign citizens and companies with more than 50% of foreign share capital cannot purchase agricultural land||—||Foreign companies and individuals cannot buy land near state borders and within the territory of a port||—|
|Serbia||Foreign citizens cannot buy agricultural and forest land or property close to the land owned by the military||—||—||—|
|Slovakia||Foreign citizens cannot buy agricultural and forest land, except for EU citizens with Slovakian residence permits who have used this land for three years||—||—||—|
|Slovenia||Limitations on agricultural land||—||—||—|
|Switzerland||Foreign citizens cannot buy land for construction. The maximum size of land with a building is 1,000 sq m||Foreign citizens need permission to buy resort property and cannot buy property for investment.
||Foreign citizens can buy property in certain cantons and according to available quota||Foreign companies cannot purchase real estate in Switzerland, however the purchase can be made in a Swiss company's name. Such company must be listed on the Swiss stock exchange and
|Turkey||Foreign citizens cannot buy more than 30 hectares of land||—||Foreign citizens cannot buy or rent property on the territory of military bases. Foreign citizens cannot own more than 10% of real estate in one district or town||Foreign funds and associations cannot buy property in Turkey. Citizens of Armenia, Yemen, Cuba, Nigeria, Syria and North Korea are also prohibited from buying property — but can buy it via a legal entity|