The Ins and Outs of Overseas Property Investment
Whether you’re a seasoned investor or a novice investor, you stand to make loads of money in your investment ventures by taking them overseas. And, you stand to make even more money if these investments are in property. How and why? Well, if you read on you might just find out!
Why overseas property investment is a good idea
There are a number of reasons why overseas property investment is a good idea, the main one being that it is widely regarded that better capital growth and higher rental profits can be found in countries that are less developed than the Western world. You see, when people don’t necessarily rush to move to an area or a country, the prices to rent in it are not all that expensive. And, if you take advantage of the low property buying prices as a result of this and then do everything you can to entice renters, eventually your rental price will be able to be increased.
Another reason why overseas property investment is a good idea that is because it allows investors to make money and generate a cash flow in another currency. Now, this might not seem like something that is altogether too important a factor because of the fact that currencies, despite being different, still amount to theoretically being the same price because of the different costs of living in different countries. But, generating a cash flow in another currency is about more than the cost of living. No, as an investor, if you can put on your investing portfolio that you’ve dabbled in another currency, and generated a cash flow in it, then you will create clout for yourself, clout that can then be used in investment opportunities all over the world.
Where you should be investing in overseas property
The location of your overseas property investment venture is pivotal to its success, but what is even more pivotal is that you always think with a long-term at the forefront of your mind. You see, when you have a long-term goal and plan with your investing right from the off you will give yourself a far better chance of garnering a big ROI (return on investment) in the end. So, when it comes to deciding what geographical area you will be investing in, you have to look at more than the area itself.
Something that you should be looking at, for example, is the potential that a certain geographical area has in regards to attracting potential property renters or buyers in the future. This could be the fact that more jobs are to be made available in that area, the fact that public transport is going to make that area more easily reachable (like the HS2 train line is going to make Birmingham, England more easily accessible to those that work in London) or any other reason why a particular area may become affluent with potential renters or buyers.
And something else that you shouldn’t be so quick to discourage as being a bad investment idea is holiday accommodation investment, particularly investing in an area known to attract a load of tourists. Yes, this kind of plan might live and die on the popularity of that particular area and the time of year it is popular. But, what you lose in off-season lack of revenue you more than make up for in in-season popularity. And, when you think in the long term like this you will be very likely to find investing success at some point in your venture, even if you have to wait for it.
How to find tenants for your property
You might think that attracting and finding tenants to live in the overseas property that you invest in is going to be difficult, but it really isn’t. Well, it really isn’t if you are willing to put in the research and hard work needed to get your property’s information out there in the right places and ensure that it is reaching your target audience.
To do this, first of all, you should make sure you are marketing your overseas property through an estate agent that is completely local to the area it is placed on. By doing so you might even be able to tap into discount rates that this estate agent offers to look after your property during the extensive amounts of time that you won’t be able to tend to it yourself. What’s more, you should be advertising your property on sites that people who live in that area of the country are likely to access. For instance, if you invested in property in Indonesia, in order to garner yourself the best results possible you would have to have the property listed on a site such as rumahdijual.com/ruko-dijual, and not a site that only people in your actual country of residence are going to access. You need to do this, quite simply, because you need to reach a certain type of people, and you are not going to do that if you don’t do specific things and put in specific amounts of effort.
Things to be mindful of when you do invest in property overseas
Well, this wouldn’t be an ‘ins and outs’ of overseas property investment if it only spoke of all the good things about taking such a venture, would it? And yes, as you can see above there are many good things about it and many reasons why you should give it a go if a property or real estate investment is your calling. But, when you do decide to give it a go you should also be mindful of all the things that could make such a venture go wrong.
One of the biggest things that can make any overseas property investment go wrong, for anybody of any experience in this particular investing field, is the fact that the physical investment is geographically so far away from the investor. You see, property investment always has been a big player in the investing game and still represents one of the best investment opportunities on the market today simply because of the fact that it gives the investor the chance to make direct changes to it. For instance, the investor can make hands-on changes to the property they invest in through renovations and repairs in order to make the property far more likely to bring them a huge return on investment in the future. But, when the property invested in is so far away (literally a plane ride away) this kind of hands-on changing cannot take place. And, when this kind of changing cannot take place, can the investor really put their trust and their eventual profit into the hands of others they might not know?
Something else that you should be mindful of if you jump into a overseas property investment venture is the fact that you will have to learn about and get to grips with a whole new set of laws and taxation requirements. You need to do this because, one, each state and nation has their own specific rules and requirements when it comes to real estate, and two, because if you break these rules you will not only fail in your investment venture but you will more than likely find yourself in deep trouble with the local law. Particularly, you should make sure you are paying attention to the rental income rules set in place in the place that you invest in. Simply, you must pay income tax on the rental income you receive, no matter how much you receive and no matter what country you receive it in. And, something else that you should always be wary of is that taxable profits should not be deducted or reduced for perusal use, they should only be done so in ways that relate to your letting business. For more advice on how to stay on the right side of the tracks when it comes to rental income, make sure to take a look at this helpful article.
So, before you take such an overseas investment venture, make sure you brush up on the rules of the geographical area you are investing in!
Investing in property overseas can be a very fruitful investment to make indeed. It can get you far more profit than investing in your country of residence can. It can give you the investment portfolio you need to really make a go at the property investment game. And, as an added bonus, it gives you an excuse to get out and see the world in your attempt to make regular trips to the property you have invested in.
So, if you’re looking for your next investment challenge, let it be in overseas property. And, when you do decide to take up such a challenge, make sure to remember all of the advice above!