Buy to Let - Overseas Property

[luceyj]

Hello,

I am currently doing a lot of research into buying an overseas property myself. I will be purchasing purely for investment purposes and would like opoinins on where best to concentrate my search.

I am looking for a two/three bed apartment/houses for around €100,000, the key to my buying would be finding a place i can get positive cashflow from - good rentals, all year round.

A lot of Eastern European property investments is based purely on potential capital appreciation, which is great if it happens. Is there anywhere that is a solid buy to let location? , with the capital appreciation taken more of a bonus than a requirement - i have a feeling Poland or Germany could be a runner.
Any thoughts?

 

[rei33]

Not much chance of positive cashflow in Poland (or anywhere in CEE). If you want certainty of rental and low prices, Germany is probably the best market. Many parts of the US as well, if you want to look outside Europe.

 

[perles]

I think France is a good country to invest, you can still find some properties at reasonable prices in the Languedoc Roussilon with great potential for rental income.

 

[budapest]

A lot of Eastern European property investments is based purely on potential capital appreciation

Not much chance of positive cashflow in Poland (or anywhere in CEE).

Good rates of return are very possible in CEE. You have to look that little bit harder though to find them. 6% returns and above are very possible to find in Budapest for example. From what I've heard, if you do your research in Warsaw, it's the same.

Relying purely on potential capital appreciation in any of these countries is a bad idea and I don't believe that an investment over here is worthwhile unless it can give you a positive return from the start.

 

[GreatDane]

Hi

Friendly Word of warning:

Some of the countries mentioned above as having good potential for positive cashflow on property investments are not Euro currency countries - so your investment is not in the same currency as you are & as such, there is a risk the exchange rate could move against you - creating a loss, in some circumstances.

Be careful when investing outside of the Euro Zone

G>

 

[icecool]

Hello,

I am currently doing a lot of research into buying an overseas property myself. I will be purchasing purely for investment purposes and would like opoinins on where best to concentrate my search.

I am looking for a two/three bed apartment/houses for around €100,000, the key to my buying would be finding a place i can get positive cashflow from - good rentals, all year round.

A lot of Eastern European property investments is based purely on potential capital appreciation, which is great if it happens. Is there anywhere that is a solid buy to let location? , with the capital appreciation taken more of a bonus than a requirement - i have a feeling Poland or Germany could be a runner.
Any thoughts?

You could consider a tourist/holiday let area and not just residential/city centre for overseas buy to let. Typically rents will be higher for holiday accomodation. Taxation benefits further a field can also be a positive.

 

[auto320]

You could consider a tourist/holiday let area and not just residential/city centre for overseas buy to let. Typically rents will be higher for holiday accomodation. Taxation benefits further a field can also be a positive.

Tourist rental accommodation in most places does not deliver in comparison to good city locations, even with tax breaks. You only pay taxes if you are making money.

19,000 people a day move to cities world wide, and this trend is set to continue. If you never learn anything else about property, remember that you buy where people are moving to, not where they are moving from, if you want to make money. In Europe, the Commonm Agricultural Policy tends to reduce the number of people in rural areas, and they have to be accommodated in cities, hence the good long-term future for city projects. As with any location, the exact place you buy within a city can make all the difference to your exit strategy.

 

[asdfg]

Taxation benefits further a field can also be a positive.

You also have to pay taxes in ireland as though the property is an irish property.
You may have to pay taxes in both countries unless there is a DTA in relation to that particular tax.

You should also be aware of the following
1. There may be problems with currency fluctuations if outside the euro zone. Your mortgage could be in Euro's and rent received in foreign currency - Poland Hungary etc are not part of the euro zone.
2. Ask about Inheritance rights. Can you leave the property to whoever you like. What taxes are payable?
3. If you are relying on translated documents and you are in dispute then the language of the original documents will be used to sort out the dispute

 

[icecool]

Tourist rental accommodation in most places does not deliver in comparison to good city locations, even with tax breaks. You only pay taxes if you are making money.

I am not discounting city buy to lets mearly indicating that returns can be higher when comparing to holiday lets talking in general terms. I have a studio apt in england birmingam city centre which ive had for the last 3 yrs with the same tenant, a great income generator. Yes city lets can provide a more secure rental income in that you can tie in tenants for long periods of time but you can typically take a week what you can in a month with a holiday let in the right place.

Your comment "tourist rental accomodation in most places does not deliver" is a little hasty in my opinion.

 

[auto320]

Tourist rental accommodation in most places does not deliver in comparison to good city locations, even with tax breaks. You only pay taxes if you are making money.


I am not discounting city buy to lets mearly indicating that returns can be higher when comparing to holiday lets talking in general terms. I have a studio apt in england birmingam city centre which ive had for the last 3 yrs with the same tenant, a great income generator. Yes city lets can provide a more secure rental income in that you can tie in tenants for long periods of time but you can typically take a week what you can in a month with a holiday let in the right place.

Your comment "tourist rental accomodation in most places does not deliver" is a little hasty in my opinion.

In order to make money on tourist lets, you have to either be there yourself or have a really trustworthy and reliable agency doing the business for you. In addition, the shorter the season, the less chance of making money. Thus holiday lets in many parts of these islands or in other short season locations do not usually give good returns. Sure, high weekly rates can be achieved for a couple of weeks in high season, but servicing costs are higher also, and the landlord is paying all the utilities etc. To base your investment strategy on the fact that you can "typically" take in a week what a long let would give in a month is foolish; these high season weeks are the icing on the cake but should not form the basis for the overall business plan. Far too many buyers delude themselves by extrapolating the high season weeks to give a projected income, but you have to be completely realistic in doing your figures.

It is a fact, not an opinion, that long term lets will give a better return, year on year. Exceptions might be somewhere that a year round attraction exists, such as a large theme park, but even then the off season rents are usually forced down by the market to a level where they usually only cover costs at best.

 

[icecool]

In order to make money on tourist lets, you have to either be there yourself or have a really trustworthy and reliable agency doing the business for you. In addition, the shorter the season, the less chance of making money. Thus holiday lets in many parts of these islands or in other short season locations do not usually give good returns. Sure, high weekly rates can be achieved for a couple of weeks in high season, but servicing costs are higher also, and the landlord is paying all the utilities etc. To base your investment strategy on the fact that you can "typically" take in a week what a long let would give in a month is foolish; these high season weeks are the icing on the cake but should not form the basis for the overall business plan. Far too many buyers delude themselves by extrapolating the high season weeks to give a projected income, but you have to be completely realistic in doing your figures.

It is a fact, not an opinion, that long term lets will give a better return, year on year. Exceptions might be somewhere that a year round attraction exists, such as a large theme park, but even then the off season rents are usually forced down by the market to a level where they usually only cover costs at best.

Thers no doubting you know your lets. Though personally I don't delude myself or extrapolate what ever that means.

 

[auto320]

Apologies if I seemed to suggest that you were "deluding yourself" -- bad choice of words on my behalf. I didn't mean you personally, just was refering to the way that many property buyers can manage to stay in denial about the realities of what they are buying or have bought.

I don't set out to offend people, just to make them reflect on what they are doing so that they will get the best from their investment. Most entrants to the property market are deluged by tons of information, very little of which is objective or balanced, and most of which comes from vested interests or their tame "journalists". Many of us who post here just would like to redress that balance somewhat. If this helps just one or two buyers to think with their brains, then it is worth spending an occasional few minutes at the keyboard.

 

[icecool]

Apologies if I seemed to suggest that you were "deluding yourself" -- bad choice of words on my behalf. I didn't mean you personally, just was refering to the way that many property buyers can manage to stay in denial about the realities of what they are buying or have bought.

I don't set out to offend people, just to make them reflect on what they are doing so that they will get the best from their investment. Most entrants to the property market are deluged by tons of information, very little of which is objective or balanced, and most of which comes from vested interests or their tame "journalists". Many of us who post here just would like to redress that balance somewhat. If this helps just one or two buyers to think with their brains, then it is worth spending an occasional few minutes at the keyboard.

No offence taken. Totally agree with you on that note re entrants to the property market.

 

[Bedlam]

Hi

In my case I am considering Paris with a view to renting out the property. I am new to this area and was wondering about the following. Would I be better off arranging the purchase through my business or privately and what would the tax position be on interest not offset against rental income in the above scenario versus purchasing it inmy own name.

Any comments / feedback appreciated

Thanks

Bedlam