Overseas Property Guide

Your Overseas Property Guide

Sponsored by Halo Financial

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GUIDE CONTENTS

3

Editor’s intro

4

Currency tips

5

European currency round-up; how has the euro performed in recent months

6 8 9 10 11 12 13 15 17 19

Spain France Italy Portugal Greece Cyprus Australia US Caribbean Dubai

21

Emerging market round-up

23

Buying tips

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OVERSEAS PROPERTY GUIDE EDITOR’S INTRO

Once upon a time, a long, long time ago – well, about seven years actually – you could have been forgiven for thinking that practically everyone in the UK was on the verge of buying a property overseas.

Television schedules were chock full of programmes outlining how Brits could make a financial killing from investing in properties overseas, while newsagent shelves were stacked with magazines promoting a similar message. As property prices in the UK spiralled well beyond the wildest dreams of many owners, more people than ever before found themselves with the means of purchasing a second property somewhere else.

And it wasn’t just long popular destinations such as France, Spain and Florida that appealed (although they were certainly far from ignored). Suddenly anywhere with cheap property, easy access – made possible by the advent of budget airlines – and laws allowing foreigners to buy property, became fair game. Bulgaria, Turkey, Brazil, Dubai... money, it seemed, could be made anywhere.

Then came the financial meltdown of late 2007. The property market in the UK – and indeed across most of the developed world – simply collapsed. House values plummeted and once guaranteed investment returns disappeared. Within months, the overseas property purchasing dreams of many had evaporated.

However, 2014 could see British purchasing interest in overseas property reinvigorated in a big way. The housing market in the UK – especially in London and the South East – has climbed back towards pre credit-crunch levels, somewhat ironically aided by cash rich foreigners snapping up luxury properties; indeed, figures released in February 2014 revealed that four in ten homes bought for more than £1 million in London were purchased by overseas nationals.

Halo Financial Fact According to figures taken from the third quarter of 2013, 69 per cent of the 55 countries tracked by Knight Frank’s Global Property Price index recorded positive price growth in the year to September 2013 - two years earlier this figure was closer to 55 per cent.

Yet the strengthening market is not only confined to the capital and its surrounds. Data from property website Rightmove, also released in February 2014, revealed that house seller’s asking prices in England and Wales recorded their biggest year on year jump since 2007, with the average asking price of a property being £251,964.

Add to this fast recovering property market, the wider picture of an economy quickly regaining momentum, and the strength of the Pound against many other major currencies, and the cause for optimism rises even higher.

Over the coming pages of this Emigrate2.co.uk guide, we’ll be taking a look at some of the world’s most exciting destinations as far as property potential is concerned, giving you a picture of how the market is performing in certain areas, and providing you with property details, mortgage information and plenty more besides.

The short-term profits associated with overseas property ownership in the early noughties may no longer be so readily achievable, but for those willing to play a longer term investment gain – or simply looking for a second property for themselves to enjoy – financial and lifestyle rewards are still available.

David Fuller Editor

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EMIGRATE2 SPONSORED BY…

Halo Financial Fact Spot contract – buy now pay now Forward contract – buy now settle in up to two years Automated market orders – target specific exchange rates and have the order filled automatically

Bank on a Good Exchange Rate Halo Financial specialise in international money transfers and can often beat the banks by up to 4% when sending money overseas.

Even something as seemingly complex as managing your currency exchange in relation to an overseas property purchase can be simple and cost effective if you use the right tools for the job. Choosing the right tool will depend on your circumstances, the property you are buying, the convincing process in your chosen country as well as the currency market conditions.

But there are some basic principles which will help.

Buying a property, will usually involve a number of payments; either ad hoc or in a stage payment plan. Thankfully, ensuring your budget doesn’t get stretched is a relatively simple process. Your initial payments can be booked as ‘Spot’ transactions.

These are agreements to exchange a fixed amount of currency and a set exchange rate within a few days of the contract being struck.

If you want to set the exchange rate for the stage payments, you can do so with what are known as ‘Forward’ contracts whereby you agree an exchange rate today for a set amount of currency but delay the settlement of the contract until a date up to 2 years in the future. This is a godsend for those who want to cut out all of the currency risk from their plans and it is even more attractive when the exchange rate in question is particularly attractive at the time.

Achieving the best exchange rate for either a Spot or Forward contract is best achieved using another particularly useful tool. The currency market is a 24/7 melee of volatility so catching the best price can be a very hit and miss process. Far better to target an exchange rate which suits your needs and place an ‘Automated’ order into the market at that level which will be triggered if that rate is available anywhere in the world at any time.

Use the right tool and you will save yourself burned fingers and lost opportunities. Leave things to chance and your investment may not be quite as attractive as you had hoped.

For Further Information If you have an individual personal money transfer enquiry please call +44 (0) 20 7350 5474 or head to www.halofinancial.com/guide for the latest up-to-date news on the currency markets and how you can get the best exchange rate.

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EURO CURRENCY ROUND-UP – BY HALO FINANCIAL

Apart from a major spike after the inflation report Sterling - Euro has been trading in a fairly narrow band recently. The pound was well supported after policy makers upgraded Britain’s growth forecasts and gave more clarification on forward guidance. The highly anticipated report didn’t disappoint as Governor Carney outlined his plans for the foreseeable future. It is now likely that interest rates will remain on hold until at least early 2015 and that the Bank will look at a range of indicators rather than solely the unemployment rate before deciding to pull the trigger. With as many as 14 different variables that the MPC will be looking at before they decide to raise rates, investors are understandably confused. Most expect the first rise to come before early 2016 which is being communicated via forward guidance.

Over in the Eurozone the debate is somewhat different. Growth in the entire EU is predicted to be around 1.2% this year. However the majority of that growth will come from Europe’s biggest economy, Germany, which is expected to grow by 1.8%. The recovery around the periphery is likely to be slow and modest; particularly as policymakers are struggling to come to terms with persistently low inflation in the region.

It is difficult to see any sustained rallies in the Euro in the short term.

So the Sterling - Euro exchange rate looks likely to continue to grind higher for the time being. Technically we have been in an upward trend since the middle of August 2013 and we expect this to continue. For now the only real resistance is 1.2250. The Pound needs to end at least one week above that line before we can be confident of further gains. On the downside, we have touched the bottom of the channel a few times now and that should continue to offer support.

For EUR Buyers You should be reducing your exposure to around 1.21 and definitely covering your risk ahead of 1.2250 (the recent high). A break above 1.225 would suggest a quick test of 1.2500. Protection should be left below 1.2035; technical indicators support this.

For EUR Sellers If you haven’t reduced your exposure already, leave stop loss orders above 1.2250 and keep your fingers crossed that we may yet see a correction.

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OVERSEAS PROPERTY GUIDE – SPAIN

There can be little doubt that Spain’s property market, along with the economy on the whole, has suffered more than most from the impact of the global credit crunch.

A report in the International Business Times in February 2014 revealed that average house prices across the cash-strapped nation have fallen by 40 per cent from their 2007 peak. What’s more, the report predicted that prices in the euro zone’s fourthlargest economy are expected to drop by another 10 to 15 per cent before they begin to stabilise.

FACTFILE Population: 46,704,314 Capital city: Madrid Time zone: GMT +1 Flight time: 2 to 4 hours Currency: Euro Exchange rate: £1=1.22 euros (as of 17/02/14) Average daily temps: Jan-Dec (in Celsius)* 9, 11, 15, 18, 21, 27, 31, 30, 26, 19, 13, 9 Average property price range: 200,000-250,000 euros * figures for Madrid

Mortgage information: - Max 65 per cent loan to value - Max term 30 years - 50,000 euros minimum loan - Rates from 3.22 per cent Information supplied by Conti Financial Services (www.mortgagesoverseas.com)

Yet in recent months, a raft of data has been released that suggests that this may not necessarily be the case. A House Price Index, published by the National Institute of Statistics late last year, recorded a quarterly price fall of 0.4 per cent and an annual fall of 4.5 per cent year on year – the smallest decline since the end of 2010.

What’s more house prices in four Spanish regions were found to be on the rise: The Balearics (4.4 per cent growth year on year), Navarra (2.8 per cent) Extremadura (2.2 per cent) and Madrid (0.3 per cent).

“Never before have so many five million euro plus villas sold in one year,” explains Daniel Chavarria Waschke, MD of Balearics Sotheby’s International Realty. “2013 has been quite an incredible year in the history of the Balearics’ property market.

According to our own market research, in Port Andratx alone 16 villas priced over five million euros changed hands in 2013, the highest valued at 18 million euros,” he adds.

Of course, the average investors are unlikely to be dealing in this end of the market, and the good news here is, that, due to the falling property prices, for those who aren’t looking for a destination offering top return-on-investment potential there has arguably never been a better time to be in the market for a Spanish property.

Spain’s long-term popularity as a tourist destination, along with an increasing number of UK flights to airports throughout Spain, means that much of the country has been opened up to overseas property buyers. Those prepared to look outside the ever popular costas, major cities and aforementioned islands, are sure to find bargains aplenty.

Property example Location: Los Dolses, Alicante Number of bedrooms: Three Features: Two bathroom, open-plan fitted kitchen, easy to maintain

garden/patio area, close to local amenities Price: 199,950 euros Website: www.spainpropertyportal.com

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CASE STUDY – SPAIN

When Paul Johnson* from Brighton purchased a home in Moraira, Northern Costa Blanca nine years ago, he did so for a number of reasons.

Firstly, it was somewhere he and his family could use to escape the everyday grind of life in the UK. However, he also viewed the property as an investment; both from a rental and capital appreciation point of view.

They chose to purchase a home in Moraira largely because they had friends who already owned properties in the area, and nine years on from the initial purchase of his four-bedroom property for 320,000 euros, Paul is more than happy with his family’s decision to do so.

“We try to visit the property at least four times per year,” he says. “I love the area and it has become something of a home from home for us.”

SNAPSHOT Name: Paul Johnson From: Brighton Purchased: Four-bedroom villa Where: Moraira, Northern Costa Blanca (Spain) Cost: 320,000 euros When: 2005

When the Johnsons’ aren’t using the property for their own personal use, they do sometimes look to supplement some of the income by letting it out to others. As any landlord will know only too well, though, maintaining a property can be hard enough even if said property is only based down the road. So how does Paul manage to make sure the upkeep of the property is kept to a high standard for incoming tenants at all times?

“Fortunately, friends who live in same area own a villa management/rental company and they look after the villa for us when we’re not there,” answers Paul.

Of course, owning a property abroad does have its pitfalls – “It always costs more than you think and things do go wrong, for example the pool pump needs to be replaced, water heater needs to be repaired etcetera, plus of course the euro depression has reduced the value of the property,” states Paul – yet, as far as the Johnsons’ are concerned the advantages to their home in Spain by far outweigh the negatives. *Second name changed at Paul’s request

Halo Financial Fact The average price of a property in Costa Blanca was 207,000 euros in the fourth quarter of 2013.

At their peak, average prices reached 265,000 euros in the fourth quarter of 2007.

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OVERSEAS PROPERTY GUIDE – FRANCE

France, along with Spain, has long been the most popular destination for overseas property seeking Brits.

And over the past 12 months, the idea of purchasing a property in the country will only have become increasingly attractive to many potential purchasers.

Early last year mortgage costs in the country fell to record levels sparked by fierce competition between French lenders to try and attract foreign and domestic buyers back into a market which had been losing traction. This has allowed British borrowers to access rates even better than what they can currently get in the UK.

FACTFILE Population: 66,616,416 Capital city: Paris Time zone: GMT +1 Flight time: 1 to 2 hours Currency: Euro Exchange rate: £1=1.22 euros (as of 17/02/14) Average daily temps: Jan-Dec (in Celsius)* 6, 7, 12, 16, 20, 23, 25, 24, 21, 16, 10, 7 Average property price range: 200,000-250,000 euros * figures for Paris

Mortgage information: - Max 85 per cent loan to value - Max term 25 years - 50,000 euros minimum loan - Rates from 2.1 per cent

What’s more, in September 2013, new capital gains tax (CGT) rules were introduced which provide a welcome relief for second home owners in the country. From now on, the required time of ownership before a secondary property becomes completely exempt from CGT will be 22 years – down from 30.

Still want more? How about an initiative that will be introduced later this year which will lead to owners receiving an ‘exceptional’ allowance on second homes or property for rent?

The reason behind these changes is to stimulate the country’s flagging property market. Due to the prevailing global economic conditions of the past few years, the number of people purchasing French property has fallen considerably in the past few years. According to FNAIM - the national association of French estate agents - the total number of house sales made in 2013 fell by 5.1 per cent year-on-year to reach 668,000 – the lowest since 2009 (594,000).

As a result, property prices are also on a downward trend, with the FNAIM recording average national price falls outside of Paris at 3 per cent last year. What’s more, some of the largest price falls were recorded in Brittany (-5.7 per cent) and Languedoc-Roussillon (-5.3 per cent) – two of the traditionally most popular regions for British buyers.

So, with a combination of low property prices and advantageous buying conditions currently on offer across the Channel, now could be the perfect time for British purchasers to invest in their own slice of Francophile life.

Information supplied by Conti Financial Services (www.mortgagesoverseas.com)

Property example Location: Saint Aulaye, Dordogne Number of bedrooms: Four Features: Two bathrooms, 150 m2 of floor space, spacious garden

including outbuildings and onground swimming pool, recently restored property Price: 250,000 euros Website: www.frenchestateagents.com

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OVERSEAS PROPERTY GUIDE – ITALY

While the Italian economy has spent much of the past five years in the doldrums, the country’s property market has arguably been as adversely affected as many others in the euro zone area.

“The Italian property market has remained remarkably intact, primarily due to the country never being heavily involved in the sub-prime lending market,” explains Clare Nessling, Director at Conti Financial Services.

FACTFILE Population: 59,685,227 Capital city: Rome Time zone: GMT +1 Flight time: 2 to 3.5 hours Currency: Euro Exchange rate: £1=1.22 euros (as of 17/02/14) Average daily temps: Jan-Dec (in Celsius)* 7, 8, 8, 13, 17, 21, 24, 24, 21, 16, 11, 5 Average property price range: 200,000-250,000 euros * figures for Rome

Mortgage information: - Max 80 per cent loan to value - Max term 25 years - 250,000 euros minimum loan - Rates from 3.1 per cent Information supplied by Conti Financial Services (www.mortgagesoverseas.com)

The reason for this, Nessling believes, is down to the fact Italians take a slightly different view towards home ownership than many of their European cousins.

“Italy hasn’t suffered the effects of the over-development of property,” she continues.

“Italian homeowners buy houses to live in rather than as an investment, and on average, move only once every 20 years. Prices, therefore, have remained relatively more realistic.”

However, this isn’t to say there has been no slowdown in the market. Largely due to a shortage of buyers – both domestically and from overseas – the number of house sales going through each year has slowed considerably – down by 6.6 per cent yearon-year in the third quarter of 2013, and by around 400,000 sales a year since 2006.

Understandably, this has caused house prices to drop slightly – especially in areas not traditionally popular with tourists and property buyers.

One development that could really entice overseas buyers back into the Italian property market this year, however, is the news that a restructuring of the land registry charges will mean that property buyers will pay less for real estate in 2014.

According to Italian real estate expert Linda Travella of Casa Travella: “‘If you purchase from a private individual as a first or main home you will save 1,260 euro in every 100,000 euros, a 1 per cent decrease in your costs on the purchase of a property in Italy. If you are buying a second home you will save 900 euros in every 100,000 euros, again another 1 per cent decrease. So if your Italian property is 300,000 euros you will save the sum of 3,780 euros on a first home and 2,700 euros on a second home.”

One thing to note when considering the purchase of a home in Italy is that the rental market is not as developed as those in a number of other European countries, largely due to the fact there are a number of rent controls and various other restrictions in place in the country. Therefore, Italian property is more likely to appeal to lifestyle buyers rather than investors looking to make a quick profit – although with such a world renowned lifestyle on offer, this is unlikely to be too much of a predicament.

Property example Location: Atessa, Abruzzo Number of bedrooms: Two Features: Recently renovated, two bathrooms, 250 m2 of floor space,

mountain and sea views, good-sized garden, parking spaces Price: 250,000 euros Website: www.realpointitaly.com

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OVERSEAS PROPERTY GUIDE – Portugal

There is little doubt that Portugal has been one of the worst-hit countries in Europe by the economic plight of the past few years.

In the year to June 2013, property prices across the country fell by an average of 2.4 per cent year on year, making it the 11th consecutive quarter to have recorded annual price depreciation. What’s more, since 2007, average values in some of the region’s most traditionally popular with British purchasers have fallen considerably – by 29.4 per cent in Alentejo and 22.5 per cent in the Algarve.

And yet, despite all the doom and gloom that has engulfed the country in recent years – and consequently seriously damaged the confidence of potential property purchasers – some green shoots of recovery are finally beginning to show.

FACTFILE Population: 10,562,178 Capital city: Lisbon Time zone: GMT +0 Flight time: 3 hours Currency: Euro Exchange rate: £1=1.22 euros (as of 17/02/14) Average daily temps: Jan-Dec (in Celsius)* 11, 11, 13, 16, 17, 19, 22, 22, 20, 17, 14, 11 Average property price range: 150,000-200,000 euros * figures for Lisbon

Mortgage information: - Max 80 per cent loan to value - Max term 30 years - 50,000 euros minimum loan - Rates from 4.74 per cent Information supplied by Conti Financial Services (www.mortgagesoverseas.com)

The country has come out of recession, tourism is strong, and there’s a feeling that property prices have bottomed out at last. Indeed, official property statistics taken from June 2013 (the latest available at the time of writing) show that while average prices may have fallen on an annual basis, quarterly they actually increased by 0.2 per cent. One of the key drivers of this increase has been the introduction of Portugal’s golden visa scheme – which offers residency to non EU-based property purchasers investing in high-end properties. This has helped attract increased levels of investment from overseas buyers, and estate agencies have started reporting big increases in sales as a result.

There is also a feeling amongst numerous agents in the country that many current property owners are keener to sell than they have been in recent years (when prices were too low), so buyers are in a strong position when it comes to negotiation.

With modern resorts, history and a fantastic climate there is much to entice property purchasers and, equally importantly for those looking at investment opportunities, tourists to Portugal. And with policies in place to restrict over development in popular coastal areas, the country should appeal to purchasers put off by the perceived ‘concrete jungles’ that have been built in some of neighbouring Spain’s more popular locales.

Property example Location: Albufeira, Algarve Number of bedrooms: One Features: Modern fully furnished apartment, air conditioned, car

parking space, shared pool, maintained gardens Price: 160,000 euros Website: www.homesforsaleinportugal.com

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OVERSEAS PROPERTY GUIDE – GREECE

While it may long have been a popular destination for tourists and overseas property investors alike, there is little doubt that Greece is currently home to one of the developed world’s most troubled property markets.

And while this may not have adversely affected the tourist market too much – although there has been a slight decline in tourist numbers, due to the country’s ongoing economic problems – overseas purchaser interest in Greek property has largely stalled.

FACTFILE Population: 10,815,197 Capital city: Athens Time zone: GMT +2 Flight time: 3.5 to 4.5 hours Currency: Euro Exchange rate: £1=1.22 euros (as of 17/02/14) Average daily temps: Jan-Dec (in Celsius)* 10, 11, 12, 16, 21, 25, 28, 28, 24. 19, 15, 12 Average property price range: 150,000-200,000 euros * figures for Athens

Mortgage information: - Currently no lending to foreign nationals for properties in Greece Information supplied by Conti Financial Services (www.mortgagesoverseas.com)

Eurostat figures released in January 2014 revealed that, when it comes to property prices, the Greek housing market posted the second-worst performance among European Union countries in the third quarter of 2013. According to Bank of Greece data, prices fell at an annual rate of 9.2 per cent in the quarter, following five years of decline – Croatia was the only EU country to record bigger price declines in the same period.

What’s more, separate Bank of Greece data also states that the total property price decreases seen in Greece has reached 32 per cent nationwide since the start of the financial crisis, while the average time a property stayed on the market last year rose to 12 months compared to just five months in 2009 – a clear sign that purchasing confidence in the country is almost non-existent.

Yet Greek government initiatives to reinvigorate the market could just make Greece worth keeping half an eye on in the future. Last year a scheme was introduced which offers Non-EU nationals who spend up to 250,000 euros on a property a five-year EU residence permit, and this development has already met with some success in certain areas of the country – especially popular tourist islands like Crete, Corfu and Zante, which have slowly started to see an upswing in sales.

It is hoped that an increase in purchasing activity could prompt a slowdown in property price depreciation and, consequently, start to rebuild confidence in the country’s beleaguered property market.

The bottom line is that, even with the currently low property prices, given the country’s prevailing economic instability Greece is probably not the best place to purchase with an eye on profit at the moment. For lifestyle purchasers intent on using the property for themselves, though, then now could be the ideal time to pick up a bargain. The aforementioned Bank of Greece data also revealed that, on average, buyers are currently able to negotiate 21.5 percent off a property’s asking price – in early 2009 the difference was 12.6 per cent – potentially making those low property prices even more appealing.

Property example Location: Lassithi, Crete Number of bedrooms: Two Features: 90 m2 of living space, private outdoor swimming pool,

fully furnished, air conditioned, landscaped gardens, parking area Price: 180,000 euros Website: www.myproperty-greece.com

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OVERSEAS PROPERTY GUIDE – SOUTH CYPRUS

Up until last year, the Cypriot property market had continued to hold steady in spite of increasing economic gloom in the country.

However, Eurogroup’s decision in March to ‘bail-in’ the depositors of two of Cyprus’ largest banks, to close down Laiki Bank, and to impose capital restrictions, left bank finances unavailable and deposits being blocked in bank accounts. It was a blow that severely impacted on the property market, and one from which it is yet to recover.

By the third quarter of 2013, property prices across the island had decreased significantly, local demand for Cypriot property was almost at an all-time low, and only purchases made by overseas buyers had stopped the prices from falling even further – and even overseas purchases are slowing.

FACTFILE Population: 1,117,000 Capital city: Nicosia Time zone: GMT +2 Flight time: 4 hours Currency: Euro Exchange rate: £1=1.22 euros (as of 17/02/14) Average daily temps: Jan-Dec (in Celsius)* 9, 10, 12, 16, 21, 25, 28, 28, 25, 20, 16, 11 Average property price range: 200,000-250,000 euros * figures for Nicosia

Mortgage information: - Currently no lending to foreign nationals for properties in Cyprus Information supplied by Conti Financial Services (www.mortgagesoverseas.com)

“Given prevailing economic conditions and the turbulence in Cyprus’ banking system, there was a lack of transactions during the quarter,” stated the Royal Institute of Chartered Surveyors (RICS) Cyprus in its quarterly report. “Local buyers in particular were the most discerning as the increase in unemployment and the worsening prospects of the local economy led to a sharp reduction in interest. Furthermore, those interested were unable to access bank-finance or their deposits,” the report added.

Financing for overseas buyers has also been halted – a measure which is further driving down prices. According to the RICS report, compared to a year earlier prices for apartments dropped by 14.6 per cent for the year while house prices decreased by 20.2 per cent.

Overall, Nicosia and Limassol recorded the biggest price decreases as they had been the least affected markets up until the second half of 2012.

And it is not only house prices that have tumbled as a result of the country’s financing issues. Average rental yields – which once made for extremely appealing reading for overseas investors – have also fallen considerably. Nationwide, the average rental yield for a house in Cyprus is 1.9 per cent year, while apartments should be more profitable with average yields at 3.8 per cent.

Some developers, though, are hopeful that the Cypriot property market will rebound strongly in 2014. The island’s economy is recovering at a faster rate than had initially been expected by the International Monetary Fund, while, having witnessed falling sales in the first nine months of 2013, investor interest improved significantly in the final three months.

Given time, it may not be too long until Cyprus once again becomes a hugely attractive proposition for overseas property buyers.

Property example Location: Kissonerga - Paphos Number of bedrooms: Three Features: Three bathrooms, situated on 260 m2 plot within housing

complex, car parking space, close to local amenities and beach Price: 235,000 euros Website: www.buysellcyprus.com

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OVERSEAS PROPERTY GUIDE – AUSTRALIA

Although the land down under may be pre-dominantly viewed as an emigration destination rather than one in which to purchase a second property, there is no doubt that a considerable number of Brits do choose to purchase a second home in Oz. According to recent figures, in 2012, foreign buyers spent a combined total of AUS$34.6 billion on Australian properties – 23 per cent of the total foreign investment for that financial year. The UK was the top investing foreign nation, accounting for AUS$4.61 billion of the total spend.

FACTFILE Population: 23,383,930 Capital city: Canberra Time zone: GMT +8-10 Flight time: 20 to 24 hours (stop off dependent) Currency: Australian Dollar Exchange rate: £1=AUS$1.85 (as of 17/02/14) Average daily temps: Jan-Dec (in Celsius)* 22, 22, 21, 18, 15, 12, 11, 12, 15, 17, 19, 21 Average property price range: AUS550,000-700,000 * figures for Sydney

Mortgage information: - Max 80 per cent loan to value for non-Australians - Max term 30 years - AUS $100,000 minimum loan - Rates from 4.69 per cent Information supplied by Conti Financial Services (www.mortgagesoverseas.com)

The lion’s share of the property purchases made by overseas buyers were seen in the state of Victoria (16,092 approvals accounting for AUS$7.98 billion), followed by New South Wales (13,145 approvals accounting for AUS$4.24 billion) and Queensland (6,356 approvals accounting for AUS$2.18 billion) However when it comes to buying a second home in Australia, it is essential to be aware that all overseas buyers (in other words non-Australians) will need permission from the Foreign Investment Review Board (FIRB) before they are able to do so.

Such permission is usually only granted to investors looking to purchase new build/off-plan properties.

It is also extremely important to be aware that property prices vary wildly throughout the country, especially in the eight state capitals (where a majority of overseas property interest is likely to be focused). Australia Property Monitor (APM) figures from October 2013 show that the median price of a house in Sydney was AUS$705,288 compared to a national average of AUS$570,755. Conversely, in Adelaide, (South Australia’s capital) the median price was just AUS$437,254.

Yet those who do choose to invest in Australia will be buying into an extremely stable property market. While Australia’s property market did not emerge from the global financial crisis completely unscathed, nor did it suffer anywhere near as badly as markets in other developed nations did. After a brief dip in 2010, property prices have been rising steadily across the country in recent years: Last year figures revealed that prices rose 4 per cent nationwide in the three months to August – the highest quarterly rise since the property boom began to slow down in late 2010.

In early 2014, the strength of the Pound against the Australian Dollar was just another factor making Oz an even more appealing destination for the adventurous investor.

Property example Location: Fremantle, Western Australia Number of bedrooms: One or two Features: Off-plan development located 23km from Perth, close to

local beach, landscaped parks and marina, property types vary Price: AUS$450,000-AUS$840,000 Website: www.realestate.com.au

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AUSTRALIAN DOLLAR CURRENCY ROUND-UP – BY HALO FINANCIAL

Technically, the rate remains within an uptrend that has been in place since April 2013. This uptrend allowed the Pound to rally from A$ 1.4383 to 1.9181 (the best rates we have seen since 2009), but fall just short of the 38.2% Fibonacci level (1.9215) of the longer term down trend (2008-2013 move from 2.7032 to 1.4393). As a rule of thumb, we would expect the market to retrace between 38.2% & 61.8% of any preceding moves. That makes the resistance level at 1.9215 key. If the market is able to break this level of resistance then it should open the door for a test of 2.00 (round number), 2.0708 (50%) and potentially 2.22 (61.8%). The Pound still has a lot of work to do in order to see these kinds of levels but as long as the uptrend remains in place it does stand a chance.

For AUD Buyers As is so often the case in this market, it is a questions of time frames. In the short term i.e. next few weeks, I would suggest trading around current levels. If you have a bit more time on your side, then a stop loss order below 1.80 seems sensible (for the reasons outlined above) with a target in the 1.90 region. If you have plenty of time on your side, then rates in the 2.00-2.05 region may be achievable later this year.

For AUD Sellers The market continues to move against you with little sign that a reversal is in the offering. One crumb of comfort is that we have failed to break above the long term 38.2% Fibonacci level at 1.9215. As long as this holds, there is a chance this entire move was pro-longed correction and a resumption of the downtrend may be possible. Realistically, I think this would be a long shot at best (given the economic data coming out of Australia) but it cannot be ruled out. Depending on your time frames and risk appetite, I would consider the placement of a stop loss order above 1.9215 with a limit order in the 1.80 region.

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OVERSEAS PROPERTY GUIDE – UNITED STATES

There have been worries in recent years about the stability of the US housing market, but during 2013 clear signs of a recovery were evident.

Rising house prices, low mortgage rates and a slowly improving economy have been drawing buyers back to the market, although some moderating influences, such as rising mortgage rates, are expected to lead to slowdown in home value appreciation, these will also contribute to a more balanced market.

FACTFILE Population: 317,546,000 Capital city: Washington DC Time zone: GMT -5 to -10 Flight time: 6 to 19 hours (Hawaii – stop off dependent) Currency: Dollar Exchange rate: 1=$1.67 (as of 17/02/14) Average daily temps: Jan-Dec (in Celsius)* 16, 17, 20, 22, 25, 28, 29, 29, 28, 24, 20, 17 Average property price range: $175,000-$300,000 * figures for Orlando

Mortgage information: - Max 65 per cent loan to value - Max term 30 years - $85,000 minimum loan in Florida and $150,000 in Alabama, California, Colorado, New Mexico, New York and Texas - Rates from 3 per cent Information supplied by Conti Financial Services (www.mortgagesoverseas.com)

According to a CoreLogic Home Price Index (HPI) report released in January 2014, home prices nationwide, including distressed sales, increased by 11.8 per cent year over year in November 2013 – the 21st consecutive monthly year-over-year increase in home prices nationally. However, the Federal Housing Finance Agency say that average prices are still 8.9 per cent below their April 2007 peak.

When it comes to location for British purchasers, top of the list is undoubtedly Florida, where property prices have fallen dramatically over recent years. Moreover, if property is within easy travelling distance of the famous theme parks, year-round rental opportunities are good too. Retirees put off by the frantic pace of Orlando and its surrounds, may be more interested in the more serene property opportunities available on the Gulf Coast. This area has become increasingly popular in recent years among people looking to winter in Florida’s renowned climate – it’s not known as the ‘Sunshine State’ for nothing.

However, British citizens may only visit the US for business or pleasure without a visa for up to 90 days per year – therefore, if you’d like to spend more time making the most of your property then you must hold a B-2 visa. This visa entitles the holder to stay for up to six months (the maximum amount of time non-residents can stay in the States). Applicants must prove they have sufficient funds to support themselves during their stay.

Given the way property prices had fallen across the country up until the recovery started in mid-2012, there could be a temptation for purchasers to look at entering the market by buying a property at a rock bottom price. However, buyers should beware of buying repossessed bargain basement properties in locations such as Detroit, which often involve too much risk. Mortgages are not available for such properties and cash purchases are not recommended.

Therefore, it’s advisable to stick with the better known and trusted markets such as Florida, California, New York, Colorado and Texas, where buyers can also find bargains with a lot less risk involved.

Property example Location: Orlando, Florida Number of bedrooms: Three Features: Located within popular golf resort, three bathrooms, two-car garage, on-site swimming pool,

private garden Price: 250,000 euros Website: www.realpointitaly.com

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US DOLLAR CURRENCY ROUND-UP – BY HALO FINANCIAL

Sterling moved from a low of 1.6250 up to its 4 year high of 1.6820 in the middle of Feb 2014. BOE Governor Carney outlined the new parameters for forward guidance in his Quarterly Inflation Report.

He said the BOE would consider the unemployment rate, business surveys and the number of hours worked before raising interest rates and when rates do rise, they would do so gradually. It has become much more difficult to predict when a change in policy is likely to occur.

After the initial confusion market reaction was to largely ignore the forward guidance and the general consensus is that UK interest rates will rise towards the early part of 2015.

The recent fall in inflation to 1.9% has certainly bought the bank some breathing space and there is little pressure for the Monetary Policy Committee to move right now. In addition it would seem that the unemployment rate may be starting to level out. Unless the data continues to outperform, we think that Mr Carney should be taken at face value and that the first rate hike will not occur until Q2 2015.

Technically the exchange rate is nudging against the trend line support where now resistance is at 1.6720.

The momentum indicators would suggest that we are close to being overdone at these levels and that we are due a period of consolidation. However a bullish flag pattern may be about to emerge which if it completes would suggest a quick move up towards 1.7200.

For USD Buyers With the exchange rate very close to the 4 year high it would be prudent to at least cover near term exposure close to current levels. If there is a break of the recent high of 1.6820 then you can expect a run up towards 1.7200. Protection should be left below 1.6600 (23.6% Fibonacci) or 1.6340 (50% Fibonacci) depending on your attitude to risk.

For USD Sellers If you haven’t already covered your exposure you may want to see how this current move plays out – A stop loss above 1.6820 would be wise hoping and praying for a proper correction.

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OVERSEAS PROPERTY GUIDE – THE CARIBBEAN

The Caribbean Islands have long been a much sought after destination for overseas property buyers. While the majority of buyers who choose a home on the Caribbean do so largely for lifestyle reasons, the region’s massive tourism market also means investors with an eye on the buy-to-let market are well served.

With so many islands to choose from, investors are spoilt for choice when it comes to looking for the perfect destination of their home. Barbados has long been a popular investment choice, but properties there have become increasingly expensive over the past few years, due to its high tourism, steady economy and prestigious reputation.

FACTFILE Population: 319,031 Capital city: Nassau Time zone: GMT -5 Flight time: 9 to 10 hours Currency: Bahamian Dollar* Exchange rate: £1=BAH$1.66 (as of 20/02/14) Average daily temps: Jan-Dec (in Celsius)** 21, 21, 22, 23, 25, 27, 28, 28, 26, 25, 25, 22 Average property price range: BAH$300,000BAH$400,000+ * Bahamas only * * figures for Nassau

Mortgage information: - Max 65 per cent loan to value for villas priced up to US$2.5 million; max 50 per cent loan to value for priced more than US$2.5 million - Max 65 per cent loan to value for condominiums priced up to US$1.5 million; max 50 per cent loan to value for priced more than US$1.5 million - Max term 20 years - US$250,000 minimum loan - Rates from 3.75 per cent Information supplied by Conti Financial Services (www.mortgagesoverseas.com)

Turks and Caicos, Saint Luca and the Dominican Republic are other islands that have consistently attracted overseas property investment interest over the past ten or so years, but the island archipelago that may currently be of most interest to purchasers is the Bahamas.

“I think the reasons that investors are choosing the Bahamas over other destinations in the Caribbean is due to the close proximity to North America and Latin America,” explains Rachel Pinder of Island Living Real Estate. “It is easy access in a lot of cases direct fights and there are also currently no local taxes including capital gains, inheritance and income.”

Although property prices in the country have fallen in the past few years – the Bahamian Dollar is pegged to the US Dollar, so economic performances of the two countries tend to be linked – Pinder does report that prices are now levelling out and, in some instances, increasing. As a result, so too is interest from overseas.

“This is the first year in several years where we are seeing more activity,” reports Pinder. “With the launching of the new BAHAMAR development at the end of 2014 there is an increased interest from Europeans in our market.”

Of course, investment opportunities and economic conditions will vary from island to island. But with fantastic year-round weather attracting a constant stream of tourists throughout the region, the Caribbean will always provide an attractive – if sometimes expensive – destination for prospective overseas property purchasers.

For more information, visit: www.islandlivingrealestate.com

Property example Location: Nassau, Bahamas Number of bedrooms: Five Features: Spacious property offering ocean views, two outbuildings

currently used as garage and office, 2 bathrooms Price: BHA$550,000 Website: www. islandlivingrealestate.com

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Caribbean CURRENCY ROUND-UP – BY HALO FINANCIAL

The overwhelming majority of the Caribbean use the US dollar or are linked to the American currency in some way. If the dollar is strong your property will cost more and if the dollar is weak property prices become more palatable. Currently the exchange rate versus the Pound is close to a 4 year high so it may be a good time to start looking to invest in that dream property in the Bahamas!

The UK economy is beginning to gain traction as we exit the great recession and all the forward looking indicators in manufacturing, construction and the service sector point to further growth in 2014. House prices are rising and unemployment levels are falling. The Pound should remain robust for as long as the data continues to point towards a continued recovery.

However, if the good news tapers off, you can still lock in current exchange for up to 2 years into the future if you speak to your currency consultant and arrange a forward contract.

For Buyers With the exchange rate very close to the 4 year high it would be prudent to at least cover some or all of your near term requirements. If there is a break of the recent high in the Sterling – East Caribbean Dollar of 4.5415 then you can expect a run up towards 4.6450. Beware of any fall in the rate below 4.4820. That’s a level at which there are Sterling sellers but a fall through there would result in further losses. You can protect against such an event with a Stop Loss order.

For Sellers If you haven’t already covered your exposure you may want to see how this current move plays out – A Stop Loss order above 4.5415 would be wise as you hope and pray for a proper correction.

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OVERSEAS PROPERTY GUIDE – Dubai

In the early-to-mid-noughties, it seemed that no area of Dubai was to be left untouched as all manner of wild and wacky property-based developments began to spring up throughout the emirate.

Whereas oil had once been responsible for Dubai’s burgeoning wealth, property aimed at the overseas and expat market was undoubtedly now viewed as the emirate’s major economic driver.

For a while, everyone from Premier League footballers and A-list celebrities to everyday, ‘ordinary’, investors were being drawn to Dubai’s new and exciting developments. Rental yields went through the roof and property prices quickly began to rise – by as much as 25 per cent per annum in some areas.

FACTFILE Population: 2,106,177 Capital city: N/A – part of the UAE of which the capital is Abu Dhabi Time zone: GMT +4 Flight time: 7 to 8 hours Currency: Emirati Dirham Exchange rate: £1=6.12 AED (as of 17/02/14) Average daily temps: Jan-Dec (in Celsius)* 18, 19, 22, 26, 30, 32, 34, 35, 32, 28, 24, 20 Average property price range: 1,350,000-2,000,000 AED (approx £220,000 to £325,000) * Figures for Dubai

Mortgage information: - No open market for mortgages to foreign nationals in Dubai at present Information supplied by Conti Financial Services (www.mortgagesoverseas.com)

And then it all stopped.

The global economic crisis not only caused a slowdown in purchasing activity in the emirate, it also put a stop to some of the ambitious resorts being built, which cashstrapped developers suddenly found themselves unable to afford to complete.

However, 2013 was something of a renaissance year for the Dubai property market.

As many developed countries finally began to emerge from their economic slumber in late 2012, so too did interest in Dubai property return. As a result, throughout the last 12-months numerous real estate companies operating in the emirate have proudly begun to boast of consistent double-digit price growth.

Indeed, according to Knight Frank’s latest Global Cities Index – which covers data taken from 27 prime markets during the third quarter of 2013 – Dubai experienced the second-highest property price increases, with values soaring by 21.8 per cent year-onyear; only Jakarta recorded larger price increases in the same period (27.2 per cent).

Some agents have recorded even larger rises that this. Asteco Dubai’s third quarter of 2013 report revealed that sales prices of residential villas and apartments recorded year-on-year growth of 26 per cent and 42 per cent respectively in the July to September period.

However, in spite of the strong price growth recorded in the past 12 months, average property values are still estimated to be one average 42 per cent lower than what they were at the onset of the global financial crisis.

What’s more, agents and developers involved in selling properties in Dubai have promised that they have learnt from their past mistakes, and that this time round price growth will be better managed and unrealistic expectations when it comes to rental yields will not be so readily advertised. If the emirate’s property market really can be kept under control, and be allowed to grow organically, then it won’t be too long before Dubai is once again viewed as a property investor’s dream.

Property example Location: The Greens, Dubai Number of bedrooms: Two Features: Located within popular family resort, two bathrooms, full

use of communal swimming pool, study, 130 m2 of living area Price: 2,100,000 AED Website: www. dubai.dubizzle.com

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Dubai CURRENCY ROUND-UP – BY HALO FINANCIAL

The United Arab Emirate Dirham (AED) is linked to the US Dollar and consequently, when you’re looking at the currency volatility between the Pound and the Dirham you can take your reference points from the more easily traceable and more widely quoted Sterling – US Dollar exchange rate. This will give you an idea of the currency’s relative strength and how it’s faring against the Pound. Since July 2013 the pound has gained 14% against the AED and consequently anyone looking at purchasing in Dubai will find – assuming a similar property price – they are paying 14% less for the property than they would have been doing only 10 months ago.

The outlook for the pound is improving over the longer term as the UK economy picks up and so GBP is expected to hold up against most major currencies including USD (and by proxy the AED). However, in the shorter term we may be close to the top on Sterling/Dirham as technical indicators are showing the possibility of a pullback and consequently a slight fall in this exchange rate. As an overseas property buyer the most important element related to currency is keeping the property purchase within budget and mitigating additional cost due to adverse currency fluctuations.

A large number of Dubai property buyers use a type of currency contract called a “forward contract” where they fix the exchange rate on their AED purchase up to two years in advance but only pay a 10% deposit when fixing the rate. So if they’re buying off plan and have stage payments over 18 months for example, they can fix the rate on each of their stage payments well in advance and they then have a clear budgeted costing well in advance on the entirety of their build. With the GBP-AED exchange rate trading at a 3 to 4 year high, employing a forward contract such as this can allow you to fix your currency exposure and lock out exchange rate loss.

For Buyers As we’re close to a 4 year high it would be prudent to take advantage of the current level and trade at least a portion of your requirement here. The market topped out at 6.1750 recently and that may be the top for the time being. Using a “forward contract” to fix the rate may be advantageous particularly as analysts expect the Sterling – US Dollar rate to trade towards 1.60 this year which equates to 5.85 on Sterling – Dirham rate.

For Sellers As mentioned above, the Sterling – Dirham exchange rate may have topped out and a correction towards 6.00 is certainly possible. So you may want to wait in the wings for now. It would be sensible, nonetheless to have some sort of protection in place just in case the market reverses and breaks above 6.1750. The ideal tool for this job is the use of a Stop Loss Order to cut the risk entirely.

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OVERSEAS PROPERTY GUIDE – Market round-up

We take a look at some other property markets which may be of interest to the would-be investor: Brazil As one of the four so-called ‘BRIC’ (Brazil, Russia, India and China) economies which are expected to eclipse all others by the middle of this century, foreign investment in South America’s largest country has grown significantly in the past few years. Canny property investors have been targeting the country for a while now, no doubt looking to take advantage of the increased tourist numbers that will converge on Brazil for this year’s Football World Cup and then again for the Olympics in 2016. Unsurprisingly, property prices during the build-up to the World Cup have been increasing significantly – especially in and around the cities which will be hosting matches – as purchasers look to maximise the rental potential of their home.

Research published by The Economist earlier this year stated that Brazil´s property prices rose by an estimated 12.8 per cent in 2013. However, many experts believe that property prices nationwide (with the exception of Rio de Janeiro – the venue of the Olympics) will drop considerably after the World Cup; more properties are also likely to come onto the market as investors look to sell. Therefore, more affordable properties may well become available over the coming years, although return on investment potential may not remain as high as it is currently.

Bulgaria For a brief period in the mid-noughties, Bulgaria was the rising star of the overseas property market.

The country’s Black Sea Coast resorts were widely labelled as being like a more affordable version of Spain’s popular Costas – both in terms of cost of living and property values – while budget properties situated around the ski resorts located in western Bulgaria offered investors an alternative investment opportunity. For a while, property price growth outstripped that seen in most European markets

and the country’s emergence as a popular tourist destination meant that rental yields were there for the taking as well. Although the financial crisis of the late noughties undoubtedly halted Bulgaria’s momentum and investor interest quickly waned, statistics taken from the fourth quarter of 2013 do show signs of stabilisation in property prices – especially in coastal areas – and sensible investors may once again start to find some long-term profit making opportunities in the market.

Canada Although there are no restrictions for non-residents wishing to purchase real estate in Canada, traditionally the neighbouring United States has been a far more popular investor choice when it comes to purchasing a property in North America.

However, in recent years Canada has increasingly appeared on the radar of more and more overseas property purchasers – mainly due to the fact the country’s economy remained healthy at a time when so many others went into meltdown. Aside from a slight blip here and there, property prices across Canada – especially in the larger cities – have been on an upward trajectory for much of the past five years; Canadian Real Estate Association figures for January 2014 reveal that the average property price in Canada was CDN$388,533 (approximately £210,835) – 9.5 per cent higher than it was a year earlier. However, while there is little doubt that the capital appreciation opportunities in Canada remain high, there are some who believe current price growth is unsustainable. A report carried out by Deutsche Bank in December 2013 found that Canada had the most overvalued property market out of the 20 countries in the developed world it surveyed.

When factors including historical property prices and rentals along with current average values and incomes were taken into consideration, home prices in Canada were found to be 60 per cent overvalued.

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OVERSEAS PROPERTY GUIDE – Market round-up

New Zealand Although it’s not the first location many would-be overseas property investors will think of when it comes to buying a home abroad, in recent years an increasing number of overseas buyers – especially from the UK, Australia, China, Singapore and Switzerland – have targeted the Kiwi housing market.

At the start of the Millennium, New Zealand boasted some of the lowest property prices in the developed world. However, increased interest in the country, driven largely by the Lord of the Rings movie trilogy that was filmed in the country, triggered a tourism and immigration boom, and suddenly the property opportunities in NZ became known to the wider world. Boosted in large part by overseas investment, NZ property prices have grown to record levels over the past ten years, and even continued warnings of property bubbles and government initiatives to try and cool the market, hasn’t dampened the growth – especially not in Auckland and Christchurch where house values boomed throughout 2013. However, overseas speculators wanting to take advantage of NZ’s property price growth may have to be quick.

Last year, the country’s Labour Party moved for a ban to be placed on non-NZ residents (excluding Australians) looking to purchase existing properties in the country. Should such a rule be brought in, foreigners would only be able to purchase new-build or off-plan homes with government permission – the same rules as which currently operate in Australia.

Turkey A myriad of reports released by overseas property experts in late 2013 and early 2014 has highlighted Turkey as being one of the world’s most promising investment destinations at this moment in time.

With still low – but steadily rising – property prices and huge tourism potential, it’s perhaps not all that surprising to find that Turkey is viewed so fondly. But perhaps the most important factor in propelling Turkey towards the top of the overseas investment charts is the fact that, for the first time, the country’s government is actively encouraging property investment from abroad. Over the past couple of years it has become much easier and quicker for non-Turkish residents to navigate the TAPA process (whereby non-Turkish residents must check their potential property purchase is not located in a military zone prior to buying it), while

residency permit laws have also been changed, meaning that foreign property owners now have an automatic year’s residency permit in Turkey (rather than just three months, as was the case previously).

Earlier this year, property in Turkey became even more attractive to foreign buyers, when the Turkish currency (the Lira) fell considerably with respect to Sterling, the Euro and the US Dollar, thereby making the exchange rate incredibly favourable to British and other European buyers. What’s more, since 2005, Turkey has been in discussions with the EU to become a member state. While a definite timescale for this to happen is still not known, should it become a reality the market would likely take off even further, as the country would become even more accessible to foreign property buyers. With all this in mind, Turkey is a country definitely worth keeping an eye on.

Thailand While there can be little doubting Thailand’s role as southeast Asia’s commercial hub and the region’s most popular tourist destination, ongoing political upheaval in the country which started towards the end of 2013 has somewhat harmed its reputation among foreign investors. While the country’s property market has long attracted investors from abroad – especially Bangkok, Pattaya and Phuket – and weathered the economic storm of the late noughties better than many others, numerous real estate agencies dealing with the country have reported a considerable slowdown in purchasing activity in the past three or four months.

That tourists have been urged to avoid Bangkok due to the unrest has sparked a general fall in the country’s economy, and while visitor numbers to other traditionally popular areas such as Koh Samui and Phuket have been largely unaffected, would-be property investors are currently taking a cautious approach, keeping an eye firmly on events in the country. On the plus side, according to a Bank of Thailand report, long-term foreign investors say they are sticking with their investments in the country despite the political woes and it is hoped that this may help prop up the economy until the volatile situation in the country calms down. Generally, there is much to like about the idea of purchasing a property in Thailand, but 2014 may not be the ideal year to consider such a purchase.

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Summary - Ten tips to consider when buying a property abroad

1

Be sure you are clear on the exact purpose of your overseas home before you purchase it.

The ideal location of the property will differ depending on whether you are looking to make money through rental yields, capital appreciation or for your own use.

2

Beware of older properties. Buying a property in need of renovation may appear cheap at first, but keep in mind that building standards may not be what you are used to. Getting dilapidated homes to a decent standard can take time and effort, and in some instances could require you tearing the entire building down and starting again. Carry out in depth checks first and get a second opinion if you feel you need it.

3

Learn how the purchasing process works in the country you are looking to buy in. A property may look great value at its given price, but does this price include ‘hidden costs’, such as property taxes, agent fees, legal fees, etcetera.

Always take legal advice – even if you are told you don’t need it.

4

Haggle over the price, just as you would in the UK. A price may be listed at a certain amount, but this doesn’t mean the seller might not consider dropping the price slightly. If you don’t ask, then you don’t get.

5

Check the credentials of the agent you are using. Ask for testimonials and don’t take anything they tell you for granted without making your own checks first. You should be fully confident and comfortable with the agent at all times, and believe they have your best interests in mind.

6

Always visit the property – or at least the area (when buying off-plan) – before purchasing.

If you don’t, how can you be sure that the promised two-minute walk from the local amenities/beach isn’t actually a 30 minute car drive? You wouldn’t buy a home in the UK without looking at it first, so why take the risk when buying overseas?

7

Check to see whether there are any financial factors that could affect potential profits. For example, will you need to pay Capital Gains Tax should you wish to sell your property? How much tax will you have to pay on rental yields?

You need to be clear on all financial aspects of owning a property, before you can start planning to make money from your purchase.

8

Beware of figures. In this guide, for each country we have provided information on how much prices are rising (or not) in given countries.

However, just because some properties are appreciating on average in value at a certain rate doesn’t mean that all will be. Your property is more likely to increase in value if it is located in a popular destination/resort – but then you will also need to take into account that there may be other people selling similar properties at the same time you are. Research is essential.

9

If you plan to let your property out throughout the year, think about how you will maintain it in between tenants. Flying out to the property to check it over yourself will be expensive, time consuming and, in many instances, not a viable option. Managing agents are a popular option; many new-build developments include such agents as part of the purchasing agreement, while in areas which attract lots of overseas buyers companies offering this service will be operating. These companies will cost money, though, and will therefore further eat into potential profit margins. If you’re buying an unfurnished property, there will also be an outlay on furniture to consider.

10 Finally, don’t bank on becoming rich overnight – the property markets have changed considerably since the early noughties when quick gains were readily achievable. Investing for profit should be considered a long-term strategy. Research the country you are looking to purchase in, and look to see if there are any future developments planned that could increase interest in that country – for example, EU membership, low-cost flight routes, top sporting events, etcetera.

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Quoting Source: guide

www.halofinancial.com/guide