Over the last few decades, there has been an enormous surge in the practice of overseas property investment as more people than ever before have begun taking full advantage of interest rates at excellent and profitable levels which have been irresistible when coupled with low property prices. Again, however, it can’t be understated that buying properties overseas (and similar investments) take a great deal of planning and forethought.
Deciding to make a foray into overseas property should never be taken lightly and can have a huge long term impact, with many elements to consider along the way – not least of which is that of foreign exchange. The simple fact of the matter is that the process of actually buying the property and handling all of the arrangements will take quite an amount of time, therefore it is inevitable that there will be fluctuations and changes in the interim.
From the very second the decision is made to take the investment, each and every minor alteration in the market must be watched carefully and will have a significant effect on overall worth and wealth by the end of the process.
Five Essential Tips
Of course, if the matter is handled correctly, the investment in property could prove to be one of the most profitable and extraordinarily value decisions a person could ever make. With this in mind, whether looking to buy a property on foreign soil to sell on at a profit, rent out as a long term source of income or perhaps eventually serve as a retirement home, there are five very important considerations that any person should follow to begin minimizing the major risks:
1. Careful Country Research
As soon as a desirable property becomes available, it may be necessary to act as quickly as possible to snap up what may well be a true goldmine in the brief window before anybody else finds it for themselves. As such, when looking into a country of choice, it is an excellent idea to put in some significant study time in advance so as to begin learning the tax system, the political situation, the culture, climate, local economy and so on before actually looking for the property itself.
2. Seek Independent Assistance
Always consider the help and advice of a neutral third party mandatory – specifically in the form of a lawyer or legal representative who has an excellent grasp of all applicable property laws. This should be done as far in advance of the purchase decision as possible. Certain developers and associates may offer their own representatives and legal parties, though caution must be exercised in order to ensure objectivity.
3. Careful Thought
A number of questions must be asked before buying in order to maximize profitability, including how much time (if any) the buyer will be spending in the property themselves, how much time is available to go through the transaction, how much time is available to spend abroad to iron out any problems, willingness to cut plans at short notice and so on. Needless to say, flexibility and time for dedication always pay off.
4. Ensure Investments are Backed
Before actually investing the money required or indeed handing over a single dime, it is excellent practice to request or even demand that the developers and their representatives provide a guarantee that the work and the developments will not just go ahead, but be completed as agreed. Doing this ensures that even if the developer in question runs into any difficulties along the way including potential bankruptcy, all of the money that has already been invested can be reclaimed.
5. Stretch the Money as Far as Possible
Always take on board the advice of an independent expert before beginning the search for a property in a particular country. It has to be remembered that the countries that were the most popular and profitable in the past are no longer so today, which in turn means that those of today may well prove to the contrary in the future. As such, seek the necessary insights required to buy with the long term in mind and ensure that the money invested brings a return for the longest possible period.
Of course, each of these steps requires a great deal of time and effort to follow to the highest order and the list is nowhere near conclusive. Similarly, you should consider whether or not property investment is for you before any action is taken – if you’re surviving from paycheck to paycheck, you may not have the amount of capital necessary to make a real go of it.