Falling real estate values, higher taxes and a faltering economy has many people in the United States discouraged. This has led to an increase of Americans buying international real estate in other countries and this trend is likely to continue. Buying foreign real estate is a great opportunity at present. Before deciding on a property or a country, however, it is vital that an investor perform his or her own research and due diligence. Whether buying an apartment in New York City, a house in the suburbs of London, something more exotic like property in Turkey for sale or investing in Nicaragua real estate. It is not possible to cover every intricate aspect of purchasing real estate in another country with one short article, but following are a few potential pitfalls as well as advantages for you to consider.
Advantages of Purchasing Foreign Real Estate
Tax Havens: Because the real estate bubble in the United States raised the value of property, many property owners were slapped with very high property tax bills. These taxes did not fall back when the property values fell, unfortunately. Therefore, many property owners continue to pay taxes on assessed values that do not reflect the actual market value of these properties. This is why people are looking to other countries because there are many places in which to invest in real estate that have no property taxes to pay. Ecuador is one of these countries. Many people are amazed to find that a United States citizen can go to Ecuador, buy an investment property and pay absolutely no real estate taxes.
Lower Cost of Ownership: In the United States maintenance on residential or real estate investment is quite expensive, due mainly to the high price of labor in the country. In other countries, highly skilled workers earn lower wages for construction that those in the U.S.
More for Your Money: U.S. dollars are worth more in other countries, including when buying international real estate.
Potential Pitfalls of buying Foreign Real Estate:
Political Instability: Be sure to research the political stability before investing to be sure the country does not have an unstable environment.
Local Real Estate Laws: Study and understand local real estate laws. It is best to hire a local experienced lawyer when buying international real estate, to help you through the legal system.