If you are considering an international real estate investment, there are some things you should know before moving forward with buying international property.
Whether you are currently a resident of the EU and considering a foreign real estate investment in the US, or you are a U.S. citizen and thinking about purchasing property in Europe or elsewhere in the world, the process can be complicated and confusing if it is your first time buying property in another country.
Here are some tips for handling your first international real estate investment.
Identify Your Goals in Investing in International Real Estate
There are many different kinds of real estate, and it is important to consider your own goals—both short-term and long-term—when making a decision about the type of property in which you want to invest.
For example, do you want to invest in residential property that you can use as a vacation home but also as a source of rental income when you are away? Or, do you want to invest in commercial real estate that will be rented out to a business in the country where you are investing? And, are you willing to invest more time and money up front to see a bigger return later on in the future, or do you need to begin seeing profits immediately?
An article in Forbes emphasizes that you should have specific goals when you decide to invest in real estate. The answers to some of the questions above can help you as you get started.
Determine Where You Want to Buy Property
As you think about where in the world you want to invest in property—and then in which city and neighborhood specifically—you will want to consider a number of different factors.
- How much does the type of property cost, on average, in the area where you want to buy?
- Is it a buyer’s market or a seller’s market?
- Will you be able to turn a profit if you decide to sell in the near future?
- What is the long-term economic outlook for the area where you are considering a property investment?
Space and Budget: Decide What You Need in a Specific Property
Once you identify your large-scale goals and the area where you want to invest in international real estate, your next step should be deciding about the type of property you want and its specifications. For example, you might ask yourself: how large or small do I want the property to be?
If you are considering a residential real estate investment, are you willing to invest in a property that will require you to rent it out? What is your ideal budget, and what is the maximum amount you are willing to pay?
Additionally, when considering your budget, keep taxation in mind. Every country has unique property tax laws.
Learn About Your Options for Financing
As an article in The Washington Post explains, bank financing often is not an option for people buying foreign property. While many people invest with cash, you may be able to borrow from “a local lender,” or you may be eligible to get financing from the seller or a real estate developer.
Contact an International Real Estate Investment and International Taxation Lawyer
Investing in international real estate comes with many complications, but an international investment attorney can help. Contact me to discuss your investment plans.