Several factors have seen the proposition of second residences take center stage for many individuals, from aspiring expats and savvy investors to retirees and those searching for a reliable sanctuary abroad. The allure of an enhanced lifestyle, experiencing a new culture and way of life, and the potential for accessing tax benefits have all contributed to the growing appeal of securing second residence and a second home away from home.

This article will look deeper into the idea of secondary residence, discussing the reasons behind its growing popularity and the benefits of a new residence and owning second homes abroad. Additionally, we’ll outline the steps to buying a second house as an investment property to gain residency or citizenship status in a foreign country.

What are second residences?

second home mortgage payment The phrase “second residence” carries a dual interpretation, encompassing both the ownership of a secondary home and legal residency status in a different country. Concerning migration, second residences refer to individuals or families who are legal residents in a country other than their primary country of residence or citizenship.

Individuals may purchase second homes strategically to facilitate temporary or extended stays in the host country. Second residences in migration contexts are frequently sought after for reasons like investment, retirement, lifestyle enhancement, or business opportunities.

They can also be as a stepping stone towards legal residency or citizenship through specific programs like Golden Visas or other investor immigration schemes. Such investment properties enable individuals to establish a tangible connection to the host country, offering a foothold for personal, financial, or lifestyle considerations while potentially opening avenues for broader international mobility.

Reasons to Purchase a Second Home Abroad

We provided a brief overview of second residence, the motivations behind hiring a real estate agent to acquire second homes abroad, and the demographics of those interested in purchasing or putting a down payment on a house overseas. Nevertheless, the advantages extend well past typical rationales like personal finance, potentially resonating with a diverse spectrum of individuals.

Second homes or investment properties purchased abroad can offer numerous benefits and serve various purposes for individuals and their families. Here are some reasons why people might consider purchasing second homes:

Vacation and relaxation

One of the primary reasons for purchasing a second home abroad is to have a permanent vacation home for getaways and relaxation for part of the year. Having a dedicated place beside a current primary residence to unwind and escape from the demands of daily life can be incredibly refreshing.

You get to experience all the benefits of overseas vacations while savoring the familiar comforts of home in a personalized setting.

Investment potential

An essential factor in acquiring investment properties revolves around long-term investment returns, potentially leading to capital appreciation over time. Whether a rental property or a second personal residence, your investment property could become a valuable asset if the country where you’re buying a second home has strong growth potential.

Investment property with high growth potential can help you reach your personal finance goals much sooner. Should you have mortgage debt on your current home, you can leverage your second home purchase to repay an additional mortgage.

Rental income

earn rental income from second home Investment properties acquired to generate rental income have the potential to substantially increase personal earnings or serve as a valuable addition to a retirement fund. Airbnb and other short-term rental platforms to list investment property for rent have streamlined the process to rent property and earn rental income, in addition to providing a way to pay for an investment property mortgage.

Should the investment property’s location be desirable for tourists or renters, it can prove favorable toward meeting lending requirements and accessing lower interest rates or a second residence mortgage interest deduction. Second homes that have the potential to generate consistent rental income are more likely to qualify for a second home mortgage and favorable second residence mortgage rates.

Furthermore, generating rental income helps to offset the costs of maintaining an investment property, paying property taxes, property management, repaying mortgage lenders on more than one unit, and other expenses associated with owning second homes.

Diversification of assets

Diversification is a common strategy for investors, and owning an investment property, or even a second home that is owner-occupied, diversifies your investment portfolio beyond stocks, bonds, and other traditional assets.

Real estate is a good investment, providing stability and diversification that other investments might not offer, particularly for investors who own a primary home in one country and a second home in another. This limits exposure to economic turmoil or downturns occurring in one country, which can lead to higher interest rates or reduced buyer interest in a second home or investment property.

Tax benefits

Owning a second home can potentially be beneficial for tax purposes, but it’s important to note that the extent of these benefits varies based on local and federal income tax laws and regulations. The way the Internal Revenue Service (IRS) defines taxes, such as sales and property taxes, or how they tax rental income, may differ from His Majesty’s Revenue and Customs (HMRC).

In some jurisdictions, you might be eligible to deduct mortgage interest payments to a mortgage lender and property taxes for both primary residences and a second home and investment property.

Additionally, if you decide to rent out either an investment property or your second home, you could deduct charges incurred during the mortgage process and expenses related to property management, maintenance, and other allowable costs. This makes the overall cost of a second home purchase generally cheaper and leaves you with more money to pay off a second home loan.

Retirement planning

Some people purchase a second home abroad, intending to retire there in the future, making it their main home. A second home can serve as a pre-retirement vacation home, transitioning into a full-time retirement home later. An added benefit is depending on where the second home purchase is made, retirees with second homes can secure long-term residence by investment through the purchase of their second home.

Legacy and inheritance

Owning a second home holds significant legacy and inheritance planning advantages. Whether you seek a second home or an investment property, individuals can establish a tangible asset that can be transferred to future generations.

Furthermore, the value appreciation of the second home over an extended time frame can contribute to the financial well-being of heirs, offering them a potential source of wealth and stability. Second home equity can be both a practical and sentimental gift, carrying forward the legacy of the original owners while providing tangible benefits for generations to come.

Citizenship or residency by investment

Purchasing second homes has historically centered around the following:

  • The privilege of possessing both primary homes and second homes, such as a townhouse or apartment, and a beachfront property or a secluded lodging.
  • Investing for future returns
  • Generate income to earn additional income or bolster a retirement pension
  • An inheritance to pass on to future generations
  • A home to retire in

An increasingly popular motivation to buy second homes abroad is the opportunity to obtain citizenship or residency in the country where the purchase is made. Many governments have introduced immigrant investor programs, granting citizenship or residency to foreign nationals who purchase second homes or investment property in the country’s territory.

Citizenship by investment or investment visas, commonly known as Golden Visas, offer distinct advantages to foreign individuals acquiring a second home as a strategic move. These immigration programs streamline the ease of doing business abroad and conducting financial transactions internationally, making them especially valuable for those seeking a long-term approach to overseas investments.

Should you be interested in purchasing a second home overseas in exchange for long-term residency or even citizenship, we have migration experts on hand to assist foreign investors looking to secure citizenship or residency through property investments.

Let us guide you on your journey to international mobility and financial growth by purchasing a second home. Contact us today for a free consultation, and take the first step towards your new global future.

It’s essential to consider your financial situation, goals, and personal preferences when contemplating the purchase of a second home.

  • Are you purchasing a second home for vacations?
  • Will you need an investment property loan?
  • Will your future generations benefit from your second home?
  • Is your potential investment property prime to earn substantial rental income?
  • Will purchasing a second home reduce investment property mortgage interest?
  • Can your investment property qualify as an investment to gain dual citizenship or residency?

These are just a few questions you may ask when considering purchasing a second home abroad. While there are many potential benefits of owning real estate overseas, there are also costs and responsibilities associated with owning and maintaining a second property. Consulting with a financial advisor, tax professional, and real estate expert can help you make an informed decision that aligns with your overall life objectives.

Second Homes versus Investment Properties

Choosing between purchasing either an investment property or a second home abroad involves considering your financial goals and personal preferences. A second home provides home equity and a personal residence for relaxation. It offers many second homeowners a familiar retreat from a primary residence in a preferred location. Depending on the country, it could be generally cheaper than buying property in the investor’s home country.

However, it comes with maintenance costs, potentially a second home mortgage, and other fees that may become burdensome if it’s not owner-occupied or generating income should it remain vacant.

On the other hand, an investment property abroad is acquired primarily as a rental property to generate income or potential capital appreciation for other investments or down payments on additional investment properties.

While they offer potential financial gains, they require careful management and may involve legal considerations and adjustments for tax purposes in the foreign country. Deciding between the two depends on whether you prioritize a personal residence or a revenue-generating asset, as well as your willingness to handle mortgage interest or other factors and responsibilities that come with each option.

Properties purchased as second homes may have different mortgage requirements to an investment property loan. Consider your financial circumstances, credit score, and the lending requirements for a second home mortgage or investment property loan. A second home loan could have higher interest rates, whereas loans for investment properties could mean lenders require a larger down payment or more extensive mortgage terms.

The Dynamics of Second Residences

Acquiring a second residence permit can bring about varying entitlements and advantages, notably temporary residence permits versus permanent residence permits.

Second residences can be acquired in the form of temporary or permanent residence status, two distinct legal statuses granted to foreign nationals, each offering varying degrees of rights and privileges.

Temporary residence: Temporary residence refers to a residence permit allowing an individual to live in a country for a specific period, often subject to renewal. The duration of temporary status can vary significantly across different countries. In certain nations, it might include a one-year residence permit; in others, it can extend to a residency of ten to twenty years.

Temporary residence is generally suitable for those who intend to stay temporarily, such as students, temporary workers, or individuals seeking seasonal experiences. Temporary residents usually have access to basic services, like healthcare and education, but their rights can be more limited compared to permanent residents.

Permanent residence: On the contrary, the meaning of permanent residence is in the name itself, granting permit holders the right to live indefinitely in a country of which they are not citizens. Temporary residents can typically transition to permanent residents after a certain period of lawful residence, which can vary depending on the country’s immigration laws.

Permanent residence often comes with more extensive rights, such as the ability to work certain jobs, access to social services, and a path to applying for citizenship by naturalization. This status holds appeal for foreign nationals considering second residences and acquiring a second home overseas, as it provides a sense of stability and integration.

This allows them to enjoy the benefits of a second residence without concerns about the legal aspects of maintaining their residence status and second homes or investment properties.

Residence by investment

Numerous investor immigration initiatives have emerged, redefining the conventional understanding of temporary residence. Despite its inherently non-permanent nature, many governments permit investors to renew their Golden Visas indefinitely, effectively providing a form of permanent residency status.

Nonetheless, an investment-based residence program providing an indefinitely renewable residence permit mandate that individuals maintain their investment property to renew their permits.

Here is a list of common residency by investment programs and their durations.


Minimum Investment





Permanent residence

Not required

Maintain the investment for five years


Renewable permanent residence

Not required

Maintain the investment indefinitely


Two years

Renewable for three years

Maintain the investment until eligible for permanent residence after five years


Renewable permanent residence

Not required

Maintain the investment indefinitely


Two years

Renewable for three years

Maintain the investment until eligible for permanent residence after five years


Two years

Renewable for three years

Maintain the investment until eligible for permanent residence after five years


Two years (conditional permanent residency)

Not required

Apply to remove conditional status after two years

Not applicable - Permanent residence

Not required

Not required

No investment criteria, provided investors adhere to the program's requirements

Resident versus Tax Resident

A significant contrast exists between maintaining residence status and being classified as a tax resident within a particular country. Simply possessing residence does not inherently indicate tax residency; conversely, being a tax resident does not necessarily imply holding residence status.

“Resident versus Tax Resident” refers to these two distinctive statuses:

  • Legal residence to reside in a country
  • Tax residence to file a tax return in a country

A person will be considered a resident if they possess a residence permit allowing them to live in the country. This often involves meeting specific criteria, such as staying in the country for a minimum number of days.

On the other hand, tax residency is determined by a country’s tax laws, which may consider someone a tax resident if they spend a significant amount of time – usually over 183 days in a year – or have specific or sustained economic ties to the country.

Being a tax resident generally subjects an individual to that country’s second residence tax regulations, requiring them to report global income and potentially pay taxes there. Several countries present tax systems featuring notable fiscal incentives, permitting investors to choose these nations as their designated tax residence in return for investments or an annual tax fee.

Here is a list of two available programs:



Tax Benefits 

Hold a Portuguese residence permit 

• Special tax treatment for ten years

• Second residence tax deduction on foreign income 

• Free remittance of funds to Portugal 

• Reduced tax rate on Portugal-sourced income 

Hold a Greece Golden Visa or possess a majority share of a Greek company 

• Special tax treatment for 15 years 

• Remit any amount of foreign income in exchange for a €100,000 annual tax fee 

It is advisable to seek tax advice from an international tax professional when considering putting down payments on second homes abroad or the idea of earning rental income from a second home or investment property.

Ways to Obtain a Second Residence

Numerous pathways are available for individuals seeking second residences. The choice ultimately hinges on your personal circumstances and goals. These routes encompass an array of possibilities, each tailored to cater to various preferences and needs.

Whether you’re interested in investment programs, retiring aboard, or new work opportunities, understanding the avenues at your disposal will ensure a well-informed decision that aligns with your unique situation and aspirations.

Family reunification: Individuals who already hold citizenship (or, in some instances, residency) can petition to be reunited with their family members. This usually applies to close or immediate family members, including children, parents, spouses, and legal partners. Some countries extend the right of family reunification to siblings, grandparents, and even nieces, nephews, and other extended family members.

Marriage: Marriage to a national is generally a qualifying criterion for a residence permit. While it technically falls under family reunification, many countries separate the two, with an application process solely dedicated to foreigners married to citizens.

Business: Often referred to as entrepreneur or startup visas, numerous countries are willing to grant residence permits to foreign entrepreneurs who establish new businesses or invest in existing ones. This can be anything from presenting your business plan for an innovative business with growth potential, investing a certain amount of money in existing large or small businesses, and hiring a minimum number of citizens.

residence by investment Investment: Residency by investment programs allow you to essentially buy second residence by investing through one of the program’s pre-approved investment options. Approved investments usually include:

  • Purchasing a second home or commercial property
  • Bank deposits
  • Purchasing government bonds
  • Contributing to national development funds

Several EU countries, like Portugal, Greece, and Cyprus, offer Golden Visas allowing investors to obtain EU residency. The cheapest investment program in the EU is the Malta Permanent Residence Program, starting with a minimum investment of €110,000 through renting a property.

Purchasing a second home or rental program typically starts from an investment of €250,000.

Global Citizen Solutions offers a tailored service to investors and expats seeking a second residence. Our team of migration specialists is here to assist you with foreign property investments to secure an alternative residence.

Contact us today for a free consultation

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If you meet a specified age criteria and can prove sufficient monthly income, you can qualify for what many countries offer as “retirement visas.” These long-term residence programs are popular in Latin American countries, commonly called Pensionado programs.

The eligibility criteria vary from country to country. Panama’s retirement visa is eligible for men 62 and over and women 57 and over. However, there is no minimum age, but younger applicants do not have access to certain benefits of the program.

Some countries may require the funds to come from a government pension or retirement account, while others are okay with seeing a regular source of income coming into a bank account.


Proving that you have enough funds or sufficient income to support yourself is a common way many expats, remote workers, and retirees have secured a second residency. Numerous countries have special residence programs granting residency to foreign nationals who meet their foreign income or savings requirements, without needing to seek work in the country.

The Spain Non-lucrative Visa will grant Spanish residence to non-EU/EAA and non-Swiss nationals who can present a monthly income of at least €2,400 or savings of €28,800. The Italy Elective Residence Visa grants residency to foreign nationals with an annual income of at least €31,000.

A much cheaper income option for an EU self-sufficiency residence permit is the Portugal D7 Visa, with requires a monthly income of €760; however, the program necessitates a continuous Portuguese bank deposit of €18,240.

Reasons to Obtain a Second Residence

Enjoy an expat lifestyle

If your primary goal is to live in a country, obtaining an alternative residence is the most straightforward path to achieve that. Common questions arise, such as “Is there a way to extend a Schengen Visa beyond 90 days?” and “Can I renew my visa without doing visa runs?”

The easiest way to avoid those circumstances and live a true expat lifestyle is by obtaining a second residence. Certain nations are lenient regarding frequent tourist visits, but numerous others are increasingly imposing stricter regulations and border controls.

The once-effective visa runs have lost their effectiveness. Even popular visa-run destinations such as Thailand and Indonesia have taken measures to curb this practice. Moreover, countries like the US and the UK have maintained a reputation for stringent visa enforcement.

You can steer clear of these complications by obtaining a residence permit, granting you the legal right to live in the country without the limitations of tourist visas. Set up your whole life in an alternative country or enjoy unrestricted freedom of a second home abroad.

A path to dual citizenship

A legitimate motive for acquiring second residences, particularly for those with broader objectives than mere residency, is the prospect of naturalization. Obtaining a second residence can serve as a pathway to dual citizenship by facilitating eligibility for naturalization in the host country.

While the process varies between nations, the primary consideration to be naturalized in a particular country generally revolves around maintaining residency for a certain period. By establishing an alternative residence, individuals often fulfill a critical requirement for applying for citizenship.

Dual citizenship gives individuals the advantage of acquiring a second passport, offering a range of practical benefits. Dual passport holders enjoy enhanced travel freedom with additional visa-free access, and full citizenship rights in the country mean no restrictions on entry, the right to vote, and full property ownership rights.

Tax benefits

second home tax benefits As mentioned earlier, being a resident doesn’t exactly indicate tax residency, and vice versa. However, in most countries, a stay of more than 183 days will categorize you as a tax resident, while spending less than 183 days in a country typically results in the loss of tax resident status.

This is particularly advantageous for foreign nationals acquiring second residency in countries with lower taxes than their home country. The loss of tax resident status eliminates the obligation of paying taxes, and gaining tax residency in a low-tax country reduces the overall tax burden.

Another discussed advantage was obtaining tax residency in countries offering special tax regimes. These tax regimes allow residents to potentially benefit from favorable tax treatments and incentives in exchange for investments or flat annual tax fees.

Taxes for US citizens

While most countries employ a residency or territory-based tax system, US citizens are bound to a citizenship-based taxation system. The tax implications mean transferring your tax resident won’t automatically result in paying reduced taxes, as the Internal Revenue Service (IRS) defines all US citizens as tax residents whether they reside in the US or abroad.

Nevertheless, a US foreign-earned income tax credit of $120,000 allows US citizens living abroad to reduce their tax liability if they legally reside overseas substantially. This tax credit acknowledges the taxes paid to a foreign country, offsetting the amount owed to the US government to reduce the overall tax burden.

Political and economic diversification

The primary goal for many seeking second residence is financial optimization and diversification. Foreign home buyers or investors who own investment properties overseas diversify their assets, potentially minimizing risks associated with an overly concentrated portfolio, such as high interest rates, and reduced rental income or potential buyers. A second home or investment property expands their financial opportunities across different markets.

Additionally, an investment property or second home located in an area experiencing rapid economic growth can offer potential appreciation in property value, yielding attractive returns on investment over time.

Regarding political diversification, second residences can provide individuals and their families with an alternative living option in case of political instability or unfavorable conditions in their home country. This strategic move ensures access to a haven and maintains a certain quality of life despite uncertain circumstances.

Changes in a political environment often occur rapidly, and a solidified alternative residence offers a crucial safeguard, allowing individuals to swiftly relocate their lives and families to a stable and secure environment when needed.

Unraveling Second Residence Misunderstandings

Second residence = second citizenship

There’s a common misconception that second residences and second citizenship are interchangeable, but they’re distinct concepts. Second residence grants the right to reside in a country, while second citizenship grants full citizenship rights and a second passport.

You can be a resident of nowhere

A common grey area in tax law created a loophole that enabled numerous travelers, especially digital nomads, to evade tax obligations by not establishing definitive tax residency. This used to be true; nonetheless, the growing trend of globalization and the expansion of temporary visa options have prompted stricter measures against tax avoidance through constant border-hopping.

A second residence investment program will be there when I need it

Immigration investor programs undergo constant modifications, and regrettably, recent changes have not been advantageous for those seeking second residences. Certain countries that had investment residence programs for some time have decided to end them, while others have doubled the minimum investment criteria.

These changes transpire due to shifts in policy priorities, economic considerations, and the need to ensure that the programs align with the country’s long-term goals and interests. That’s why Global Citizen Solutions is the ideal choice to aid you in your second residence aspirations. Our team of specialists sources up-to-date information and criteria, ensuring successful residence applications and foreign investments. Contact us for a free consultation.

Frequently Asked Questions about Second Residence

Can you have two primary residences?

You have the option of maintaining both a primary residence and an alternative residence, and either one can be considered your principal residence based on your personal choice and the duration of your stay.

What is a second residence?

A second residence is possessing the right to residency in a second country through family reunification, a work permit, or investment such as owning a second home.

Why do people acquire a second residence?

There are multiple reasons why people acquire an alternative residence; these include:

  • Seeking a higher standard of living through a better climate, cheaper living costs, and new cultural experiences
  • Expanded business opportunities or investing in countries with favorable economic conditions
  • Accessing quality education opportunities in reputable institutions
  • Retiring in more affordable or appealing locations
  • Benefiting from special tax concessions or lower tax rates on income and capital gains on second residence
  • Having a secure place to reside during political instability or in uncertain political environments
  • Gaining travel freedom, such as access to regional mobility alliances like the Schengen Area
  • Safeguarding assets like investment properties by diversifying across different jurisdictions
  • Providing a haven for family members in case of emergencies
  • Acquiring investment property to earn rental income or capital appreciation, or a second home for vacations

What does country of residence mean?

Country of residence refers to the nation where an individual has established their principal or secondary place of domicile, typically spending a significant portion of the year there. It signifies their legal and official residence, generally indicating where they live, work, and contribute to the local economy.

Country of residence is often crucial in determining an individual’s tax obligations, legal rights, and access to various services and benefits provided by that nation. It’s different from citizenship, which signifies a person’s nationality and can impact matters ranging from taxation and healthcare to legal jurisdiction and voting rights.

Can I use my second residence as a vacation rental?

Listing a second home or investment property as a vacation rental depends on the law in which the second residence is owned. Some jurisdictions restrict private residences from use for vacation rentals. Others may allow specific investment properties or properties in certain areas to be listed as vacation home rentals, provided the resident visa permits the permit holder to do so.

What are the potential drawbacks or considerations of owning a second residence?

Owning a second home offers numerous advantages but has several potential drawbacks and considerations. Financially, acquiring, maintaining, and insuring a second home can strain budgets, especially when factoring in property taxes, utilities, and maintenance expenses.

Depending on the tax laws of an individual’s home country and alternative residence country, they could be double taxed, obliging them to pay capital gains tax on the sale of second residence properties in their home country and country of overseas residency.

The real estate market’s unpredictability poses risks to property valuations, and renting it out can entail challenges such as dealing with a property management company and vacancies. Additionally, regulatory changes or shifting laws could impact property ownership and rental arrangements. Famous cities like Barcelona and Berlin have seen outright bans on short-term rental property listings. In contrast, American cities like San Francisco only allow house buyers to earn rental income by renting rooms in their personal place of residence.

Can you buy a second home in another country with a mortgage?

It is often possible to go house hunting abroad and buy a second home with a downpayment and mortgage. However, the process, requirements, and mortgage terms can vary significantly from one country to another. Investors seeking second home equity abroad opt for this approach to go house hunting sooner and secure second homes.  

Generally, individuals buying a second home must work with local banks or mortgage lenders in the country where they seek a second home loan. Before offering a mortgage, many lenders will evaluate a buyer’s financial background, credit score, mortgage debt to income, and the property’s value. 

Legal and regulatory considerations, currency exchange rates, tax implications, and the buyer’s residency status in the foreign country prevent mortgage fraud. They are also factors that can influence mortgage requirements, credit scores, and access to financing programs like FHA loans (Federal Housing Administration). 

Can I get a mortgage in the US if I live abroad?

Generally speaking, obtaining a second mortgage or investment property loan in the US while residing abroad is indeed feasible, although it involves navigating through a range of intricacies with mortgage lenders. A Mortgage lender like Rocket Mortgage extends mortgages to non-residents, but the process is typically more intricate, and most lenders require meticulous documentation, including the prospective property management company and real estate attorney.  

A high credit score demonstrating a strong credit history, stable income, other real estate investments, and providing comprehensive financial records become imperative. Non-resident buyers might encounter larger down payment requirements or a higher interest rate for a second home compared to what they’d pay for a real estate mortgage in the US, reflective of perceived elevated risk factors. 

While securing a second home mortgage for a second home and investment property from abroad is viable, it demands careful research to identify lenders willing to work with international buyers and a thorough understanding of the specific requirements and potential challenges involved in the process. 

Can I obtain citizenship or residency through owning a second residence?

Purchasing a second home abroad can provide a pathway to citizenship through residency by investment or citizenship by investment. Residency by investment enables individuals to obtain legal residency and potentially acquire citizenship by naturalization after a minimum residency period.

Certain countries offer citizenship by investment programs allowing foreign investors who purchase real estate to obtain citizenship in exchange for their investment. These programs, often referred to as economic citizenship programs, grant individuals the opportunity to secure citizenship and all associated rights and privileges by making a significant financial contribution to the country’s economy.

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