‘Dire at best’: A 44-year-old Chicago woman bought a house listed for $1 in Italy — then had to spend $446,000 on renovations to make it a home. What to consider before buying abroad

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Financial advisor Meredith Tabbone never expected her exploration of her family's Italian ancestry to lead her to a life-changing turn of events. While studying her Sicilian heritage, she stumbled upon Sambuca di Sicilia, a quaint Sicilian village, which was auctioning off a vacant home, with starting bids as low as one euro.

This was an opportunity that was just too good to pass up.

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Tabbone placed a bid without seeing the outcome, but the excitement of her risk paid off when she discovered she had won.

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However, her 1 euro dream quickly turned into a reality check. A bidding war increased the final price of the property to 6,200 euros. Once the house was officially hers, she started the real challenge: turning the “dire at best” property into a livable home.

The True Price of Relocating

Moving to cities with lower housing costs is becoming more popular, since skyrocketing house prices across the U.S. are making homeownership unaffordable for many people.

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The Italian property was initially listed for sale for 1 euro, but the real cost of Tabbone's Sicilian dream ended up being much more than that. She thought it would cost around $40,000 to make the property habitable. However, soon after purchasing the property, she bought the house next door for approximately $23,000 to create more living space. Ultimately, she spent about $446,000 on renovations over the course of three years.

Residing in the city of Chicago with no prior knowledge of renovation, Tabbone encountered numerous complications and substantial financial burdens.

It can be very costly to fly back and forth," she said to CNBC Make It. "I would definitely say that it was the second biggest expense I had. My contractor was the most expensive thing to me.

Despite the financial and logistical challenges, Tabbone's experience of turning these houses into homes she could truly love suggests that the promise of an affordable property abroad can often come with extra costs that far exceed what's listed.

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Was it worth it?

For Tabbone, purchasing properties in Italy was more than just a financially driven choice – it was a way to reconnect with her Italian roots. However, whether it was a shrewd financial decision isn't so straightforward if her primary goal was to flee the high cost of living in the U.S.

Tabbone acknowledges the unique circumstances surrounding her situation.

I was lucky that the construction took so long because I didn't have to draw from my savings," she said to CNBC Make It. "I could simply pay the invoices as I received them because the renovation process has dragged on.

For many Americans, making a similar move might demand tapping into savings or even dipping into retirement funds – decisions that could put long-term financial security at risk.

The appeal of moving abroad can be great, casting aside more practical considerations. In addition to the initial cost of purchasing a home, ongoing expenses such as upkeep, property taxes, and home insurance are also factors to consider.

Living abroad can also come with complexities related to visas and residency. For instance, tax implications are a crucial factor for U.S. citizens, as they are still required to follow federal tax laws no matter where they reside. This typically means you'll still need to file U.S. taxes on all of your earned income.

If you are a US citizen or resident alien, your worldwide income is usually subject to US income tax, no matter where you are living.

Healthcare is a significant consideration. While some countries provide more affordable healthcare choices, non-citizens may face limitations or require additional coverage, increasing their overall expenses.

Is moving overseas or owning a second property in another country worth your while? The answer depends on various factors. For some people, their dream of having a second home may be more realistically achieved by renting it out as a vacation property, which can be more cost-effective and less of a financial burden.

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This article contains general information, and no recommendations or suggestions are implied. It's intended to be informative only, without any guarantee or assurance of any sort.