I had a similar problem...
This is from the main help:
Question: How do I edit my street address to an address in another country?
Answer : Due to security reasons, PayPal only allows one country address per PayPal account. When moving from country to country, you must close your existing account and open a new account in the country where you are residing.
To close your account, log in to your PayPal account and click Profile at the top of the page. Click the Close Account link located under Account Information and follow the online instructions.
