Buy to Let - Overseas Property

luceyj said:

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

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rei33 said:

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

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luceyj said:

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?

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icecool said:

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.

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Taxation benefits further a field can also be a positive.

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auto320 said:

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.

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icecool said:

auto320 said:

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.

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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.

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auto320 said:

icecool said:

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.

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

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auto320 said:

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.

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