"Abroad is predominantly where we look," he told BBC Scotland.
"If there's anything in Scotland, we'll look at it but, if they are doing well, it's tough because, generally, the market they look to is England.
"The salary bracket we're in makes it hard, makes it hard to match those wages."
Neilson's side secured a top-three finish before the Premiership split on their first season back in the top flight.
And the head coach overhauled his Championship-winning squad extensively, supplementing a pool of younger players who have come from the club's academy with foreign signings such as Arnaud Djoum, Igor Rossi, Blazej Augustyn, Juwon Oshaniwa, Abiola Dauda, Perry Kitchen and top-scorer Juanma Delgado.
"We try to sell the whole package - the club, the atmosphere, the city, the training ground and the opportunity to come here - do well, and get a move afterwards," said Neilson.
"To come up from the Championship and get European football has been great for us and we'll try and build on that for next season.
"It's always important to adapt your team and try to improve it.
"We're quite a way along. We want to extend [the contracts of] the guys who we think will be assets for us in the future and also look to bring in new players.
"We've contacted players and we're in the process of looking at them."
Hearts sold striker Osman Sow to Chinese club Henan Jianye in January and Neilson is relaxed about approaches for his best players over the summer.
"We're in a position where we don't need to sell, so if anyone wants to make an offer it needs to be big money," he said.
Neilson's men host Premiership leaders Celtic on Saturday lunchtime. Hearts have twice held Celtic to draws this season and the head coach would like to avenge two defeats with a first win over the champions since the 2012 Scottish Cup semi-final.
"We've done okay," he added. "I'd like to have picked up some more points.
"Performance-wise it's been good, it's now time to get the points from them."
Hearts will continue to search overseas for fresh talent because Scottish players are often too expensive, says head coach Robbie Neilson.