What happens to my foreign real property/land when I die? Some may say this is a first world problem, and it is hard to fault them. As real estate is typically governed by the law of the land, there may be conflicts of laws issues arising if, for instance, your will is governed by Singapore law while your property is located elsewhere.
Each jurisdiction has its own specific rules for dealing with real property (land) and how it is to be dealt with upon the passing of its owner. For example, Singapore’s Residential Property Act (the “Act”) is designed to restrict or at least control the extent to which foreign persons can own “residential property” (defined to mean, essentially, landed property and not, for example, condominiums). Under the Act, no residential property can be owned by or held on trust for a foreign person without getting appropriate permission from the authorities (this process has been facilitated in the case of residential property located in Sentosa, an island resort in Singapore).
If the owner of residential property passes away, leaving that property to a foreign person in his or her will, that foreign person is effectively prohibited by the Act from inheriting the property. Instead, the deceased person’s personal representative(s) must take steps to sell the property to a Singapore citizen or persons approved by the authorities within 10 years; the proceeds of sale will be passed to the foreign person designated in the will.
Who would have thought that owning property/land overseas would be such a hassle after death?
What can you do? First and foremost, before you make a will, you must remember to list out all your overseas assets carefully and inform your lawyer. Otherwise, notwithstanding that there is often a “catch-all” clause at the end providing for the rest of your assets, your foreign property may be ignored, mismanaged and squandered.
Additionally, depending on whether that foreign jurisdiction will recognise the Singapore will or whether the foreign jurisdiction permits the writing of two wills, you may wish to consider making two (or more) wills, each specific to where your assets are located. However, extreme care must be taken to ensure that the wills do not contradict (or worse, revoke) each other.
Unfortunately, there is no easy and fast rule on managing your overseas real estate nor is there a simple answer to whether a particular foreign jurisdiction will accept a Singapore will. Much will depend on which jurisdiction is applicable In this case, you may wish to appoint a foreign counsel to help you wade through these complicated waters.