International Real Estate Investing – The Time is Now
International real estate investing is a topic that has become more familiar in the last few years, especially due to the increasingly fluid global market economy. One question any serious investor may ask is whether the time to invest in international real estate is now.
Just like any other form of investment, the international real estate business has its share of ups and downs, and as an investor you must be willing to up your ante to be exposed to whatever benefits or drawbacks may come.
International Real Estate Investing:
If you have the cash to invest, no time but now could be better for venturing into international real estate. The reason is simple. Each nation has different economic currents that go up and down at different times. While it may be a recession in the local/home economy, the same may not be the case in another country, unless the world is facing a global recession, which is highly unlikely to occur exactly at the same time (there is usually a few years time delay.)
Two key things will determine whether or not now is the time to invest in international real estate: risk tolerance and patience.
As you may not expect any business to shoot to its peak at once, so you must be prepared to wait on it to come around. When it comes to international real estate, you will be trying out a completely new real estate business environment and it may take some time to accustom yourself with the new local practices.
First of all, you need to study the markets and location where the odds are favorable. Think of a country with a good history of international real estate investing. Consider the most booming real estate markets. For instance, a few of the countries that usually come to mind are the United Kingdom, China, Switzerland and Canada. A good website with in depth analysis of global real estate markets, including United States, is Newmark Grubb Knight and Frank.
The secret is about doing quality background check of the countries you might have an interest in. The housing or residential property market is nonetheless considered the most appropriate measure for assessing a country’s real estate market (more than commercial.) The reason is simple. The housing market in any country is an essential component and indication of its national economy,
The 2007 and 2008 global recession that was triggered by the crumbling of the United States housing market at the time clearly attests to this. However it did not all happen at once – the global recession was triggered in 2007 by the United States, but the European countries, for example, did not follow until years later. So for instance, while United States real estate market and economy crumbled in 2007, Italy did not follow suit until almost 5 years later.
Here are a few elements that will point you to the right direction in assessing the right international real estate market for you to consider, besides sites like Newmark Grubb Knight and Frank as stated above:
- Local consultants/real estate agents
These are a great source of information on the local market. Contact a real estate professional operating within the markets you are targeting to explore. You will realize that the tax, property and title laws of each country are uniquely different.
The same goes for the travel infrastructure, cost of living, safety and security. All these considerations will impact your choice of property investment destination.
Local real estate professionals are well versed with these pieces of information as they are constantly interacting with them in their line of work.
- Price drops
It may be a good idea to consider countries that have seen significant drops recently in the property value. Examples include Spain, Italy, Portugal, and Greece.
While these countries have experienced economic distresses, overbuilding still remains one of the main factors that have led to the price drops. Spain, for instance, no longer has some restrictive legal roadblocks and therefore has some great opportunities for international real estate investment.
The fact is that the world is indeed becoming smaller. Economic exchanges and investments are easier and even the private investor can jump on board with the international economy and profit greatly from fluctuations in the markets.
Popular real estate sites, like Realtor.com, now have an international real estate division, where they show listings from countries all over the world and they are adding more countries all the time: Realtor.com International.