An impressive part of owning rental properties is that there’s no need to stick to a single local market with today’s technology. Sometimes, buying outside of the town or city where you live can be far more profitable and offer you new opportunities and perks. You may even attempt to explore buying rental property in another country. There are various excellent reasons to do so, from diversifying your investment portfolio to planning for retirement. However, acquiring property internationally may sometimes be difficult to do. That’s why it is vital to know as much as you can about your desired location and financing options before buying property abroad.
Why Go International
For many reasons, some investors prefer to acquire a rental property in other countries. For those investors, it offers a way to diversify a real estate investment portfolio and achieve higher returns. Some investors aim to discover locations that tend to attract tourists but have a low cost of living. In some cases, these areas can make for higher rental income. Another strong reason to invest in international real estate is to prepare for retirement. While numerous regions in the U.S. can strain the average retirement income, there are lots of areas around the world where costs are lower, and retirement funds can last much longer.
Things to Know Before Buying
Of course, there are other considerations relating to your desired location and property before you invest. These include:
- Laws: Every country has specific laws that govern real estate transactions. Lack of information about the applicable laws could produce complications, from property rights disputes to delays in the purchase process. Be sure you are familiar with the laws that apply in your case!
- Citizenship and Ownership Rights: In other countries, property can only be owned by citizens. Other countries may also have different ideas about what constitutes ownership, and establishing or passing on that ownership may differ from how things run in the U.S.
- Currency: Instabilities in currency are somewhat common and difficult to predict. When doing any significant financial transaction, you need to be prepared for currency exchanges to be rather fluid and, in some cases, may experience losses as a result.
- Stability: Residing anywhere outside of your country of residence comes with certain political risks, principally if the country’s government in which your property is located isn’t stable. You may risk losing your property, income, or related assets if worse comes to worst.
Financing
Another significant consideration of buying rental property internationally is financing. Few U.S. lenders will even consider loaning funds for property outside of the country, which leaves investors with a range of alternatives. Most investors pay cash or use funds from a retirement account to purchase a property outright.
This is the most straightforward route to take, though the most expensive. In some situations, you may be able to qualify for Golden Visa or other country-sponsored programs or work with lenders in the country where the property is located. Just be alert for scams; many would-be scammers see foreign investors as easy targets.
If you’re a remote investor looking into purchasing rental property in Enfield and the surrounding areas, Real Property Management Beacon can assist! Our Enfield property managers work with investors of all sizes to help assess properties, locate off-market deals, and much more. Contact us to learn about your options.
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