Real Estate Matters | Overseas investing – should you consider it?

Juliet Risdon

There is a quote by a famous real estate investor Louis Glickman that says, “The best investment on earth is earth”. That’s right, the entire earth (well, almost all of it) is a potential investment!

But when it comes to buying properties, many investors limit themselves to investing in the market where they live and work although they instinctively understand that their money could potentially be working harder for them in an overseas market.

But is chasing glittering returns in a foreign market the way to go…should you consider investing overseas?

The answer really depends on the individual investor and of course, the investment.

If you decide that you are interested in an overseas investment that offers greater returns, here are some factors that you may want to consider;

Legal – Are foreigners eligible to purchase property in this market? Are there any additional legal requirements for foreign buyers? Is the legal system transparent, and what are the procedures for dispute resolution?

Tax – Taxation is said to be as certain as death, and this applies worldwide. You should find out if there are additional taxes for foreigners as there is in Hong Kong and Macau, and whether it’s possible to enjoy tax benefits by investing under a corporate structure. 

Forex – When investing abroad, forex can be a double-edged sword that can either mean a huge discount or bring a previously profitable deal into the red zone. Whenever possible, it is favorable to buy the foreign currencies when your home currency is strong, and should you wish to, remit the profits back when your home currency is weak.

Financing – As with any property investment, you need to know how much leverage you can find and how much it will cost you. If you are borrowing from a foreign bank, they are likely to offer a higher interest rate and lower loan to value (LTV) compared with local residents, at least until they feel comfortable with you. 

There are many things to consider before deciding whether overseas investing is for you. JML Property offers UK properties for sale, so stay tuned and don’t hesitate to get in touch if you want to find out more.

Sam Lee is a marketing manager and property consultant at JML Property.  JML was established in 1994 and offers Investment Property & Homes. It specializes in managing properties for owners and investors, and providing attractive and comfortable homes for tenants.

www.JMLProperty.com

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