Lithuania

P

Paul Graham

Guest
Can any one help me i am hoping to invest in property in lithuania .
property values,rent yeilds, areas to invest ,property agents lost ! has any one any experience ? novice
starting research. If any one has any experience much appreciated
 
Why Lithuania in particular? Have you visited the country? Have you any connections to it? Both useful (if not exclusive) precursors to investment...
 
Thanks for your responce
according to mr hobbs the figures are quite good for investment and i was i hoping for some leads to the questions to research.do you have any leads
 
Rental demand.
Cost.
Tax.
Legal issues re. title etc.

etc. etc.

But those are general questions-browse the Proprty Investment forum for loads of information.

I think you should familiarise yourself with the risk/reward of property as an investment in general before worrying about specific areas, e.g. Lithuania.

Remember that EH may have a vested interest in expounding the virtues of Lithuania.
 
Surely if EH says Lithunia is a good investment......well that's all you need. What about the Cape Verde. That's another location touted by EH. He has admitted he has never visited the place (wherever it is), but so what......

I am amazed that investors (!) will consider buying property on such flimsy evidence. We continue to see various promoters advertising property in far-flung parts of the globe (I doubt sometimes that they are even on the globe) offering such enticements as:
  • 10% leaseback for 10 yeras and
  • the prospect of 50% capital growth
It seems that the vast majority of these promoters are entirely unregulated and can promise any level of return.

Surely if you are considering investing in any foreign location, the basics are:
  • visit it, see if it exists
  • check the local market, what prices are locals paying (or is this another case of a "special price for the Irish")
  • check rental levels, demand
  • check local income levels (who will rent your property)
  • check security of title, local taxes etc
You dont even need to read a book to figure out the basics. Just do the research.
 
I believe Diarmaid Condon offers an overseas property consultancy service. I have not had experience but have heard he is quite good and doesn't sell property so the advice is actually independent. His website is worth a visit in any case http://www.diarmaidcondon.com (www.diarmaidcondon.com).
 
Investors in foreign property should also be aware of the following:
1. Rental income stated as guaranteed may not be realised. The property is increased by the guarantee so in effect they are giving you back your money.
2. You will be liable to tax on the profit on foreign rental income in Ireland and you may also be liable to tax on foreign property.
3. When you sell the property you will be liable to CGT in Ireland and may be liable to similar tax in foreign country.
4. There may be problems with currency fluctuations
5. Is there a double taxation agreement with Ireland? If there is you may be able to off set the liability in foreign juristiction against the liability in Ireland. If not you will be liable in both juristictions.
6. You may have to do two computations in relation to your tax affairs. One for the Irish Authorities the other for foreign authorities. Remember it is up to you to make the necessary returns.
7. Any advise you get, get in writing. Ask them what qualification they have to give this advise. Are they tax expert in this area etc.
8. Ask about Inheritance rights. Can you leave the property to whoever you like. What taxes are payable?
 9. Is there a viable selling market with the local population or will you have to sell to foreigners






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From Revenue
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How are foreign rents taxed?

 In general, income from foreign property is computed on the full amount of the income arising, irrespective of whether the income has or will be received in the State. In the case of foreign rental income this income is charged under Case III of Schedule D and the same deductions and allowances are available as if the income had been received in the State. Deductions are also normally available in respect of such income for sums in respect of foreign tax paid. This income should be included in an individual’s tax return on the Foreign Income panel.

These rules do not apply to a person who is not domiciled in the State or who is an Irish citizen not ordinarily resident in the State. In such cases, income tax is computed on the full amount of the actual sums received in the State from such remittances, etc. without any deduction or relief given.

 From Revenue website as at 1/1/06
 New treaties with Argentina, Egypt, Kuwait, Malta, Morocco, Singapore, Tunisia, Turkey and Ukraine are being negotiated

 Tax Treaties
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Try searching for some of the letting agents web sites in the relevant country to get some idea of the rents. Look at Specific towns/areas as the rents may vary massively between each, evenin small countries/cities
 
I agree with Qawra,

As a foreign prop owner, the only place to guage what something will rent for, is to check the local sites; just like you would check the Herald or daft.ie for the irish buy2let market.

Guaranteed rental schemes are an ABSOLUTE SCAM, 100% of the time. You are in effect (as is mentioned above) paying your own rent. The only place i've seen this work is in France, with long-term leasing.

Also, never believe a word an Agent tells you, including Eddie Hobbs; the sound-bytes are good, and in the main actually quite true, but you need to do your own research. If you have $dollar-signs$ for Cap Appreciation, and a wad of cash to spend, then you will be shafted. Taking candy from a baby.

Go to the internet, and find english-speaking newspapers in the relevant country. If the irish are buying property there, it will almost certainly have a DB of articles on property, and most likely a property section.

these sites also show property for sale, at the local price. Everything in eastern europe sells in price per sq.meter. You will find the local price differs from the agents price by about 20% usually, sometimes much more. This is a fact of life with all apartments sold to foreign interests.

The Property section of AAM has some good threads on foreign property, eastern europe in particular, with some good posts from people who have been down the road, and learned the lessons. Worth a search.
 
Thanks for the responce so far if any body has anything else to add i will be happy to take it on
 
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