The world is changing fast and to keep up you need local knowledge with global context.
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Investing in property overseas has many advantages over keeping all your property investments in SA, most notably it allows you to benefit from the rand’s fickle nature. You might not be able to go on an actual buying trip at the moment, but you still need to pack a virtual case before you begin your investment journey.
In the same way you would ensure you had everything you needed for a real overseas trip, you need to make sure you are sufficiently prepared, so you do not waste either time or money.
Begin by doing some thorough preparation. If you are planning to go invest in the US, make sure you know all you can about the market and what you can expect. This research will ensure that you make your way to the part of the country that has the most to offer you. For example, Las Vegas may have been the place to buy in 2007, but by 2012 property had lost 70% of its value. You need to make sure you have current and reliable information and get it as far as possible from impartial sources.
While investigating your potential location get all the details on the cash flow and capital appreciation, many investors got their fingers badly burnt during the global financial crisis. You might want to make a quick buck, but what you need is an investment that provides a reliable and stable income.
Once you have a good sense of what to expect from your chosen location, you need to make sure you have good partners to work with. Offshore investments have a lot to offer, but you need to have people you can trust there, especially when you return home after striking a deal. The most important trait to look for is trustworthiness. They also need to able to add value to your investment. Online platforms, such as Wealth Migrate, can be invaluable partners in this process as they bring many years of industry and tech savvy to each deal that participate in.
- The seven laws of property investment
- Why crowdfunding is only a stepping-stone on the path to successful global investment
- How to avoid the pitfalls of investing offshore
When it comes to partners the best ones offer everything in-house, in other words, they help to locate a property, renovate it, manage it and maintain it. When the people who renovate and manage the property also have a stake in it you can be assured of high-quality work, keeping your investment in the kind of shape that will attract high-quality tenants.
Every single person you deal with while preparing to join a particular deal needs to be assessed. Do some research so you get an understanding of their track record in the industry.
The research you have done will give a good idea of the lay of the land today, but as important are the long-term prospects. For example, many property companies in the UK have battled since the Brexit vote in 2016. You need to have a good sense of the kinds of issues that you may face in the future and how they could affect your investment.
Throughout the preparation stage, it is important to be responsible and not allow yourself to be swept away by your emotions. If you are faced with a fabulous deal in some far-flung land, take the time you need to have a good hard look at the numbers and do the maths to make sure you know everything about the deal before making a decision.
It is not easy to be successful when investing in a foreign land, but taking the time and effort required to prepare yourself will set you on the right path.
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