Nowadays, real estate investment market abroad is quite lucrative.
Still, there are a lot of challenges and cheaters. An investor dealing with real estate abroad must consider many factors: from assessing suitable markets to understanding the legal aspects of a foreign country.
This comprehensive guide breaks down all the information you need to maximize your real estate investment abroad.
Important considerations for international real estate investors
If you want to become an international real estate investor, here are nine tips to keep in mind.
1. Research the local real estate market and legal framework
When making a real estate investment abroad, you should not rely on global trends. You need to do your homework and assess the real estate market in your desired location. Consult several reputable sources and compare the information obtained.
Also, check the amenities, local infrastructure, and available security measures that could affect the value of the property. It is advisable that you personally visit the site while conducting the local real estate market research.
As a foreigner, you should also be aware of the legal provisions related to real estate investment abroad in the country you are interested in. You don’t want to be on the wrong side of the law.
2. Have a local partner in the country you are considering
A local partner can be a trusted real estate developer or a reputable real estate agent. They will be your source for all the necessary information. This includes the local real estate market, laws, restrictions, cultural characteristics, etc.
A reputable local partner increases your likelihood of a safe and successful real estate investment abroad.
3. Hire a bilingual, dual qualified attorney
A double-qualified lawyer saves you from hiring two lawyers to steer the legislative processes in both countries. A bilingual lawyer guarantees accurate and effective communication throughout the buying process. With a lawyer who has both dual qualifications and two languages, you ensure that your interests as an investor are well represented.
4. Use money transfer companies
You would probably consider using your bank for international money transfers for real estate investments abroad. While banks offer security for transferring large amounts of money, the cost implications can be very severe. The high exchange rate margins and transaction fees, especially for large amounts of money, quickly become an expensive proposition.
Instead, try hiring a money transfer company. The safety of the process is guaranteed, the safety of your money is guaranteed and the transaction costs for your real estate investment abroad will be significantly lower.
5. Consider getting a mortgage locally where the asset is located
It is more advantageous to take out a local mortgage where your overseas real estate investment is located than to take it out in your home country. Beyond access to finance, you gain access to the expertise of the local mortgage lender. This could make your investment experience easier and cheaper.
6. Don’t get involved in investments targeting foreigners
If a real estate investment abroad is marketed specifically only for foreign investors, that is already a warning signal. Such investment projects are mostly scams or tricks to take advantage of your finances by over-pricing the real estate. It is important to do due diligence on any overseas real estate investment you intend to make.
7. Translate the documents
Correctly translating all property documents from the local language into English may seem like a minor task – but it is essential. Accurate translation by a professional translator ensures that all information presented is valid to avoid potential legal issues.
8. Be aware of macroeconomic conditions
A country’s macroeconomic conditions play a large role in determining the country’s future. Financial stability or instability, for example, has a significant impact on the value of real estate and the development of rental demand. Therefore, you need to understand a country’s macroeconomic conditions before making any real estate investment abroad.
9. Focus on one well-planned investment
When it comes to real estate investing overseas, it’s always wise to dip your toes in the water before going all-out. Therefore, instead of tackling multiple real estate investments, try a single project first. If you focus on a well-planned investment, you will avoid several mistakes.
Variety of property types and investment strategies
Take a wide berth when it comes to the type of property you want to buy overseas. A good place to start getting an overview of the property types available is to contact a reputable real estate company.
Suppose you are looking for prime real estate in Vienna. In this case, you need a trusted provider with a wide range of real estate options – from apartments and houses to commercial properties and rental properties in the lucrative city center. Such a platform should offer many real estate options based on your search criteria.
As well as looking at a variety of overseas properties to invest in, explore different strategies. You could invest in real estate overseas to rent out as a permanent source of income or buy to upgrade and resell. Your overseas property could just be your second home, which is still a great investment.
What should be considered when buying a property abroad?
There are three main factors you need to consider before deciding on a location and property abroad.
- popularity of the place. When determining the popularity of the place where you want to buy a property abroad, you need to ask yourself two important questions:
- Is the location and property you are considering investing in popular with holidaymakers?
- Can you imagine visiting the place year after year and still enjoying it?
- accessibility of the property. Accessibility is crucial for any successful real estate investment abroad. The two important questions to answer are:
- Is the property near the airport which is served by multiple airlines?
- How long is the flight to and from the potential real estate investment abroad?
- Equipment available. The availability and accessibility of community facilities increases the value of real estate investments. Therefore, your real estate investment abroad should be close to restaurants, entertainment, shops, etc.
If you keep all the above points in mind, you can rest assured that the overseas property investment process will be easy and hassle-free.