All Topics / Overseas Deals / Due Diligence on International Properties

Viewing 10 posts - 1 through 10 (of 10 total)
  • Profile photo of DrChrisDrChris
    Member
    @drchris
    Join Date: 2007
    Post Count: 1

    How do you go about doing your due diligence on international properties? Do you fly overseas to inspect, have a local partner who can inspect, or pay a building inspector to go through?

    Profile photo of billaaa777billaaa777
    Participant
    @billaaa777
    Join Date: 2007
    Post Count: 1

    This is what I would do if somebody approached me and I was unfamiliar with the area.

     

    A)  Get there proposal or business plan, explaining what they do, how they do it, how long they have done and some facts and figures on specific properties.

    B)  Ask for web sites of the local real estate agents so you can check out the prices in the area. Taking into consideration the difference between the asking price and actual selling price.

    C)  If you like the numbers they presented and then the research you have done on the web it is time to make a phone call or have them call you. You can call VOIP (Skype) now for 2 cents a minutes any where in the world.

    D)  If everything has gone well to that point it is time to take a vacation and meet the person face to face. And let me say, there is no place better to visit than Pattaya, that’s why I am here. Ask them to show you some properties they have done, meet the real estate agents they do business with, meet the contractors that work for them, and finally look at the properties they are presently suggesting.

    E)  If that all went well, time to invest in a small unit. If your ROI meets your standards, well by all means let’s upgrade to the next level.

     

     

    This was real quick explanation of what I would do, if you have any more questions I will be glad to answer them.

     

    This is where you can find a few condos I have done. http://www.freewebs.com/billaaa777/

    Profile photo of rebecca22rebecca22
    Participant
    @rebecca22
    Join Date: 2007
    Post Count: 12

    Hi

    For the states there is a website called http://www.homeguage.com who do inspections with reputable inspectors. Also they say to contact the national REI clubs and used nationally accredited inspectors from the National Association Independent Appraisers and the National Association of Residential Property Managers for higher standards and less problems.

    Hope this helps.

    Profile photo of Don NicolussiDon Nicolussi
    Participant
    @don
    Join Date: 2005
    Post Count: 1,086

    Do you fly overseas to inspect, have a local partner who can inspect, or pay a building inspector to go through?

    would not hurt to do all three – especially in the early stages.

    Don Nicolussi | Mortgage Broker - Home Loan Warehouse
    http://homeloanwarehouse.com.au
    Email Me | Phone Me

    "I think of finance as a technology, a way of getting things done." Robert Shiller

    Profile photo of camakoscamakos
    Participant
    @camakos
    Join Date: 2007
    Post Count: 14

    I'm currently in the US, checking out properties to invest in. Nothing beats being on the ground. We have learnt an incredible amount just by being here. You learn so much more about the market, the areas and the properties, as well as how things work. Which is really important as things are very different to how they are done in your own country.  Its also great to build those relationships so in the future you can continue to invest from your home. We have establised great relationships now with very talented, professional people and so feel confident in doing it from our living room in OZ in the future. This alone has made the trip worthwhile. (and you get a holiday which you can write off some expenses for!!)
    But that of that is not feasable for you, its still possible to do it. Do lots of research on the net and build great relationships with people in the area you want to invest in. A good building inspector will definitely help in the due diligence for that part of the investing. We just had one complete an inspection on our property, even with us here. Trust the experts to do the right job.

    Good luck with it. I'm writing a blog on our experiences, if you want to check it out. Feel free to email with any other questions

    Profile photo of Luke TaylorLuke Taylor
    Participant
    @world-changer
    Join Date: 2005
    Post Count: 415

    Hi Guys,
    Yes definately you need to get on the ground and check out the deals.
    You cant possibly get a proper feel for an area or value in a deal without being there physically.
    But you also need to do alot of research aswell.

    Be careful of the websites that give u property values.Most often these are very innacurate.

    Take yr time before u begin buying deals too so yr emotions are not yr guide!

    Luke Taylor | Hope Property Investing
    http://hopepropertyinvesting.com
    Email Me

    Property Support,Strategist and Buyers Agent

    Profile photo of Steve McKnightSteve McKnight
    Keymaster
    @stevemcknight
    Join Date: 2001
    Post Count: 1,763

    My vote is also to go and look for yourself in the first instance.

    You can get no better feel for the area than investing time on the ground, but more importantly, you will need to locate and engage a team of locals to make life happen for you when you are not around. For example, you will most likely need a local solicitor, accountant, rental manager, etc. Doing this remotely is difficult.

    Think carefully about investing overseas. My experience is that it is harder then investing where you live, and the extra complexity doesn't always equate to the higher returns.

    For example, those who bought in the US when the dollar was at (say) 1AUD:US0.72 will be hurting badly now. Work through this…

    A property was bought for US$70,000.  Assuming this was fully financed from AUD, the equivalent amount needed in AUD to close (ignoring closing costs) would be AUD97,222.

    Assume now that the exchange rate is 1AUD:US0.84.

    To sell the same property (ignoring all costs) and get back your AUD97,222 you would need to get US$81,666. This is a 16% return needed to break even.

    In summary, my point is that it is important to borrow in $FX, otherwise you run the risk of being a quasi FX trader rather than a property investor.

    Cheers,

    Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
    https://www.propertyinvesting.com

    Success comes from doing things differently

    Profile photo of FizzypoppFizzypopp
    Member
    @fizzypopp
    Join Date: 2007
    Post Count: 13

    Another important aspect if you are looking at trends is to check the values of real estate in the past with the local authorities. This means you can get an historical view of the trends to see if it is up or down. It is very easy to get carried away with what the Realtor says, the brokers says, what the developer says, and what the contact says — all of these are opinions. Even the appraiser will only base their opinion on past circumstances and add a bit of guesswork. But if you mass all of the data together and check with the Registry Office you will at least get an overall view. Visiting — you may only get to see what they want you to see. I have been around real estate for 25 years and it is not the most honest of industries — so it pays to get to know who you are talking to long-term.
    Paul

    Profile photo of Nigel KibelNigel Kibel
    Participant
    @nigel-kibel
    Join Date: 2005
    Post Count: 1,425

    My advice is to go there and inspect the market yourself. I spent a great deal of time in Texas last year and their is nothing like seeing and experiencing a market for yourself. Do not buy over the internet sight unseen and always question what you are told.

    Nigel Kibel | Property Know How
    http://propertyknowhow.com.au
    Email Me | Phone Me

    We have just launched a new website join our membership today

    Profile photo of how2how2
    Member
    @how2
    Join Date: 2007
    Post Count: 5

    Team

    PI international is a minefeild – find a good contact in the country you like and build a relationship, then make your move

    I work with a number of Aussies investing in NZ

    I recommend going to a workshop in NZ – find out who the players are and then deciding

Viewing 10 posts - 1 through 10 (of 10 total)

You must be logged in to reply to this topic. If you don't have an account, you can register here.