Every investment portfolio requires regular assessment and perhaps adjustments as conditions change. Perhaps your portfolio is not diversified enough and is overexposed to the risks and uncertainties of one particular asset class or geographical market. There could be any number of factors that may signal that it’s time to make some sound adjustments.
The best redress has always been diversification with a solid offshore spread. Investing in international property is an excellent value-adding option in this regard. Carrick can assist you with this and answer all your questions. Let’s look at some of the basic issues involved.
Excellent reasons for investing in offshore property
Buying property has traditionally been seen as a safe and prudent investment that provides diversification with long-term capital growth or income generation, or both. But even better, international property investment will add geographical diversification, spreading risk over various markets.
Investigating different offshore property markets may reveal some very appealing and lucrative benefits and options. For example, tax benefits, exchange rates, regulations, or market and jurisdictional stability may all favour a foreign investor like yourself.
But, as different markets perform differently and don’t carry the same risk, knowledge and understanding of these markets are critical, as are research and due diligence. Carrick is excellently positioned to assist you with this.
What are the key issues we look at?
Prior to making any recommendations, we’d first look at three key determinants:
Economy: A stable, robust and growth orientated economy with diverse industries is primary to any investment decision; but it also increases employment that in turn enhances property investment opportunities and values.
Population: A growing local population is indicative of a growing demand for living accommodation which increases opportunities and drives property prices upward.
Infrastructure: In tandem with rising population density in a particular location, a government will usually focus on improvement of transport connectivity and other infrastructure in such areas, or enhanced CBD development. This will increase the demand for and value of property as well as the rental income from such property.
Key questions investors need to consider before buying offshore
- Fully understand the purchase process, legal and tax implications, and the local mortgage process.
- Will income, capital gains or inheritance taxes, or exemptions thereof, affect expectations of a reasonable profit?
- Consider the exchange rate, currency volatility or fluctuations with a longer-term view.
- If you are buying-to-let, ascertain the rental viability of the property and even if you have the cash, consider a mortgage that can be repaid from the rental proceeds, as mortgage leveraging offers strategic advantages.
- Do due diligence on your foreign partners such as developers, letting agents and management companies.
Let Carrick help you understand and navigate the international property market
International property can be a reliable growth asset that provides continuous reliable returns through capital growth and rental yields, with minimal active management or personal involvement.
If you’d like to find out more about the excellent advantages of investing in international property and the processes involved, contact Carrick today at [email protected] to set up a meeting with one of our wealth and investment specialists.