Top 10 Tips for Investing Overseas

Not what you were looking for? Continue your search here...

1. Don't let your emotions cloud your business judgement If you are buying for investment purposes particularly, try not to become emotionally involved, remember this is a business transaction and unless you plan to stay and use your overseas property choose an area with strong capital appreciation and just because you wouldn't live there yourself doesn't mean it's not a good investment. According to the Royal Institute of Chartered Surveyors review in 2006 the top rising markets with the highest capital appreciation in 2005/6 were Estonia, Denmark and Spain. However, this data is now well out of date as the Spanish market in particular is no longer a speculators market.

2. Research and understand your rental market Be careful if purchasing in large blocks of apartments exclusively sold to investors, which can often complete together bringing large supply into the market at one time. Twenty or thirty apartments can easily find tenants, but prepare to wait longer if you're the owner of an apartment in a block where hundreds of apartments become available to rent at the same time. Also ask local letting agents the type of units that rent easiest, if the area is over developed there can sometimes be an oversupply of two bed apartments.

3. Remember transaction costs seriously reduce your returns Remember transaction costs reduce your overall yield. For example in Germany apart from transfer taxes (stamp duty) the buyer pays the estate agency fees, not the vendor. Transaction costs also increase in countries where the loan to value rates are low, the more cash you have to put into a deal the less the return on investment. Check all your transaction costs before buying, ask your solicitor for a full quote in writing outlining all taxes and fees, but remember to ask for it in writing before you commit.

4. When is a discount not a discount? It is easy to get discounts on higher value properties, over priced properties and over supplied destinations. Remember list prices are developer driven and they always tend to price at the top of the range. Just because you receive a 10% of buyers are say German buyers and if the German economy should experience problems, then this will seriously effect your ability to re-sell your overseas investment.

Read the rest of this article on http://www.internationalproperty.ie/propertyarticles.htm

Henry Davis is an Irish based Property Investor developing in Manchester and Liverpool www.internationalproperty.ie or +353 87 2344000