The global tax report 2015 by Knight Frank and EY: Shanghai and Monaco are where foreign investors are offered the lowest property costs and taxation
International investors buying foreign property can get the lowest costs in Shanghai, according to a new report.
However, it's Monaco that offers the lowest taxation when purchasing a property at both $1m and $10m (£7m).
The slowing rate of property price growth in many cities worldwide has made transaction costs and taxation increasingly important factors for buyers.
The global tax report 2015 by Knight Frank and EY looked at the holding and selling costs for foreign buyers of prime residential property in the five years to 2015.
“When purchasing property as an investment, tax is not necessarily the first concern but it is important because it is often the after-tax return that measures the success of the investment," Carolyn Steppler, private client tax services partner at EY, UK & Ireland, said.
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"Our research shows that the tax burden across the cities in this report varies considerably both in amount and extent."
London sits in the middle of the 15 cities analysed for property costs and taxation,
Cities where property costs are the highest include Paris, Berlin and Geneva, with the highest costs for a $10m exceeding 10 per cent, taking them above the $1m threshold.
But when it comes to taxation, property in Sao Paulo worth $1m and $10m costs investors 31.5 per cent over five years, followed by Hong Kong where investors are charged 22.4 per cent of $1m of the property cost over a five year period.
"However, a common thread across all these countries, which shows no sign of slowing, is a continuing focus on property as a source of taxation," Steppler added.