All Topics / Overseas Deals / Tips on buying overseas property

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  • Profile photo of KeysxmKeysxm
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    @keysxm
    Join Date: 2013
    Post Count: 1

     Before buying an overseas property, buyers should visit the desired place during both on and off-season.
     Consult an international property brokerage firm of your own country as well as the place where you want to buy a property.
     Ensure your eligibility regarding passport, visas and regularity in terms of how often you can visit your overseas home.
     Buyers need to be aware of both foreign investment laws and the particular country’s laws where the buyers intend to invest.
     Buyers should check all the rules and regulation of that particular place where they want to purchase property.
     Ensure to check the taxation cost and the maintenance cost of the property before buying, as many countries expect foreign buyers to pay huge amount for property transactions and taxes.

    Profile photo of Ziv Nakajima-MagenZiv Nakajima-Magen
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    @zmagen
    Join Date: 2012
    Post Count: 523

    I'd completely disagree on the second tip – why on earth would I want to pay double finder's fee (if not much beyond that)? I'd much rather invest (much less) in finding one good local agent in my destination country. The first and third tip, as well, seem to be mostly relevant to purchases for personal purposes, as opposed to investment…the rest of the advice, although so general as to be almost meaningless, is at least sound, from my perspective also. Wealth of information on buying overseas here – http://itunes.apple.com/us/app/rei-wealth-mag/id552053319?ls=1&mt=8%29 (ipad only, unfortunately).

    Ziv Nakajima-Magen | Nippon Tradings International (NTI)
    http://www.nippontradings.com
    Email Me | Phone Me

    Ziv Nakajima-Magen - Partner & Executive Manager, Asia-Pacific @ NTI - Japan Real-Estate Investment Property

    Profile photo of TerrywTerryw
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    @terryw
    Join Date: 2001
    Post Count: 16,213

    And make sure you can speak the language of the country you are buying in!

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://www.Structuring.com.au
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au

    Profile photo of Ziv Nakajima-MagenZiv Nakajima-Magen
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    @zmagen
    Join Date: 2012
    Post Count: 523

    Or have (a) verifiable and accountable partner/s in place speaking that language ;)

    Ziv Nakajima-Magen | Nippon Tradings International (NTI)
    http://www.nippontradings.com
    Email Me | Phone Me

    Ziv Nakajima-Magen - Partner & Executive Manager, Asia-Pacific @ NTI - Japan Real-Estate Investment Property

    Profile photo of TerrywTerryw
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    @terryw
    Join Date: 2001
    Post Count: 16,213

    You can never really rely on someone else.

    I remember when I was in Thailand looking at a property and I couldn’t speak much Thai then, but knew some. I took a friend’s friend with me to interpret. I was asking “can I get a loan to buy this property” and she was translating “can he live alone here”.

    You also really need to read contracts in the language they are in. A small misunderstanding can have far reaching consequences. Reading Japanese contracts takes a lot of energy. I had to put my daughter in hospital in Japan for an operation and had to sign various documents. Very worrying what you are signing when the language is not your mother tongue.

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://www.Structuring.com.au
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au

    Profile photo of Ziv Nakajima-MagenZiv Nakajima-Magen
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    @zmagen
    Join Date: 2012
    Post Count: 523

    Not sure what you mean by "rely" – there are ways to verify potential advisors, professionals, business partners etc in every country – and also ways to verify your recourse in case things go south. Clients do this to us every day, and we do the same to others in other countries. "Jumping into bed" with anyone who sounds promising is extreme folly, but avoiding all foreign environments for fear of language or cultural barriers is the other extreme. Incidentally, speaking "the same language" didn't seem to do much good to those swindled in the US, as we've been reading here – I've yet to see myself, or anyone else, get screwed over like this in Japan, Singapore or Hong-Kong, for instance, to name just a few of those "scary foreign places" which are far more regulated and safe to purchase in compared to the US, to name one "comfy English country".

    Ziv Nakajima-Magen | Nippon Tradings International (NTI)
    http://www.nippontradings.com
    Email Me | Phone Me

    Ziv Nakajima-Magen - Partner & Executive Manager, Asia-Pacific @ NTI - Japan Real-Estate Investment Property

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213

    Yes, Ziv, that is a good point about those getting swindled in USA, speakign the same language. I guess there are those who don't read contracts even if they are in English.. And it is not just language bit different ways of doing things that is important to consider.

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://www.Structuring.com.au
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au

    Profile photo of Joel.MacdonaldJoel.Macdonald
    Member
    @joel.macdonald
    Join Date: 2012
    Post Count: 52

    Interesting post this one.

    Here is what I did 4 years ago when I purchased my first US property in Phoenix, Arizona.

    Studied the Macro economics of America and what industries and economic trends were developing. (This is very important! Detroit looks great on paper, but when you dig a little deeper……not so great)

    Decided to target Phoenix first. Needed to see it to believe it.

    Was taken on a tour of the 6 best school districts in the city

    Interviewed agents and construction teams to further get a feel of which area I would target and decide who I would use.

    I wanted to make sure the agent I chose had dealt with foreigners before and also spoke to the clients of these agents to gain further inside information on whether I could trust them or not. Not treating this interview process seriously may come back and bite you. There are a lot of sharks who want to make a quick buck.

    You need to make sure you have someone on your side, with experience in the market and foreign investors

    Spoke to many locals in 5 different suburbs I was taken to. Asked them about the street, whether it was quiet, whether they would let their kids play out at night time. Again, I was trying to de-risk everything 

    Interviewed an attorney about entity structure

    Set up a bank account

    Spoke to an accountant about tax issues, then spoke to a specialist back in Australia that I still use today about AUS/US tax issues

    Opened up a currency account to get wholesale currency exchange rates

    Started to put in bids at around 25% below listing price to test the waters. Instantly had a few approvals, which kind of told me I may have been able to put in even lower bids.

    Finally purchased my first home while back in Australia.

    Renovating management was a bit hard via the internet and email was challenging. (I purchased a few turnkey after that. And then purchased a few foreclosures after the turnkey experience.)

    Rented the property out. 

    Wasn't happy with my property manager and sacked him and moved to someone else. I am still finding today, the Americans go at a slower pace than we expect in Australia.

    This might have been a basic overview but I hope it gives someone an insight who is thinking of investing.

    The biggest thing a first time investor needs to do is to analyse the risks in each market you are thinking of investing in.

    De-risk your investment by only investing in a market with good employment and population growth. Good infrastructure, schooling, landlord/business friendly.

    Don't chase the returns. It is not worth the headache. I have had client after client come to me and say the same thing.

    Every city has its bad areas. Even a solid city like Atlanta or Dallas still have areas to avoid. Leverage off the knowledge from people who have done it before. This will fast track your learning and help you make a confident and well educated decision on where you are going to target to invest.

    Regards,

    Profile photo of Ziv Nakajima-MagenZiv Nakajima-Magen
    Participant
    @zmagen
    Join Date: 2012
    Post Count: 523

    Brilliant textbook research and process, Joel. These are exactly the right steps one should take – and it also illustrates the importance of ground-work – once you've spent the time and money to lay down the infrastructure for all future purchases/sales and remote management and have the right people in place representing you, you can pounce on any good deal that comes along, wherever and whenever in the world you may be at the time. We did the same thing when we started out in Japan – spent a good few months in meeting, setups and research on the ground – and are now reaping the results for ourselves and our clients without having to set foot in a realtor's office unless there's a compelling reason to. Not that we don't visit regularly (we actually spend about half of every year there), but it's not for the purpose of, or under the pressure of, a due by date of contract signing, inspection, money transfer etc – more structured, scheduled visits for general management and upkeep, as well as to research and explore new areas.

    Ziv Nakajima-Magen | Nippon Tradings International (NTI)
    http://www.nippontradings.com
    Email Me | Phone Me

    Ziv Nakajima-Magen - Partner & Executive Manager, Asia-Pacific @ NTI - Japan Real-Estate Investment Property

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