Tips and Tricks for Making the Most Out of Your Overseas Real Estate Investment

With Brexit looming ahead and casting everything in a morbid shadow of uncertainty, economic predictions are gloom. Not all of it is dark, of course, but one cannot argue that Brexit will cause (in fact, it’s already causing) economic instability. The exact outcome of it is impossible to calculate at the moment, but having a reasonably safe investment in real estate overseas is a smart precaution.

However, if you choose to go down this route, you will fast learn that there are quite a few challenges that make it more expensive than it should be. But do not fret. Anticipating possible issues and using specialized solutions to cut money transfer fees is the best way to make this investment lucrative even in this unstable economy.

Considerations to Make if You Plan to Invest in a Property Overseas

An overseas property will make a great addition to anyone’s investment portfolio, says Ian King, Los Angeles-based non-practicing attorney, leveraging his expertise in international real estate law to guide clients through the complexities of cross-border investments. However, making this investment isn’t as easy as purchasing a domestic property. Many countries have varying limitations for foreign investors as well as foreigners who want to own real estate in the country proper.

You also need to research and understand the guidelines of taxation for foreign investors. Those vary greatly from place to place, so you need to consult a tax professional both in your country and in the country you plan to buy real estate in. Unfortunately, with the current situation in Britain, it’s hard to predict whether a new tax will pop up that will be levied against foreign investors. You definitely should keep an eye on the situation.

Another important factor to consider is the law. To make sure everything goes smoothly, you’ll need to hire a solicitor to handle the transaction on your behalf. Note that you need to find not any random solicitor but someone who specializes in working with foreign investors.

The costs of your solicitor’s services as well as your own travel expenses all go into the overheads of your investment deal. You’ll also need to invest in various permits and specialized documents and these costs need to be included as well. You’ll need to calculate all these expenses before making the final decision. This way, it’ll be easier to say whether the deal will be worth it.

You also shouldn’t forget one of the biggest issues that overseas investors might have. Money.

International money transfers are expensive, especially if they go through banks. Therefore, you should start looking for the best alternative to banks. Currency exchange rates are another thing to keep in mind as they can add a hefty amount to your high-volume transfer.

Luckily, today one has no shortage of options when it comes to offers of cheap foreign currency exchange and international money transfers. One of the most notable startups in this field was TrasferWise, which raised $58 million in funding back in 2015, but now many companies, including Hargreaves Lansdown also offer that service. This means that you need to compare the available options as not all of them are equally beneficial for different markets.

How to Get the Best Deal When Investing in Real Estate Overseas

As a foreign real estate investor, you will need to do a lot of research in order to get the best possible deal. Start with researching real estate markets in order to pick the best destination for your investment. Consider where rental properties offer the best value for your money. At the moment, Portugal, Brazil, Singapore, Croatia, and the Philippines seem like the most promising destinations.

Next, start researching the best money transfer service. Look not only at the fees but at currency exchange rates and additional services that can help you save more money. For example, forward contracts can help you secure a favorable currency exchange rate.

You might be somewhat limited in your money transfer options because these services aren’t available everywhere. Consider this factor when choosing destination for your investment as it will make a big difference at the time you get down to payments.

If you plan to purchase properties in several different countries, you’ll need to conduct this research for each in order to find the cheapest and most efficient option that meets your needs in every situation.

Finally, focus on reducing your overheads. As this is the most flexible cost, you should be able to cut it down in a few simple steps, from finding a more affordable solicitor to staying in a simpler room in the hotel.

In Conclusion: Investing in Your Future

At the moment, Britain’s economy is undetermined and somewhat unreliable. Therefore, investing in real estate overseas is a good idea. As long as you research the place and ensure that the property will benefit you long-term, you should start searching for the best money transfer method that will allow you to reduce exorbitant fees set by banks. Be thorough in your preparation for this investment and be sure to hire local legal and tax professionals to help guide you through it.

Charlotte Giver

Charlotte is the founder and editor-in-chief at Your Coffee Break magazine. She studied English Literature at Fairfield University in Connecticut whilst taking evening classes in journalism at MediaBistro in NYC. She then pursued a BA degree in Public Relations at Bournemouth University in the UK. With a background working in the PR industry in Los Angeles, Barcelona and London, Charlotte then moved on to launching Your Coffee Break from the YCB HQ in London’s Covent Garden and has been running the online magazine for the past 10 years. She is a mother, an avid reader, runner and puts a bit too much effort into perfecting her morning brew.