Questions to ask Irish agents of Foreign Property

D

Drapier

Guest
Like me, you've probably noticed the trend of Newspaper Property Supplements, over the last 12-18 months, to have shifted away almost completely from Irish to Foreign Property. Even small independent Real estate agents will have property offers on foreign developments. It's everywhere. Buying/viewing trips arranged. Seemingly reasonable prices. Very seductive. Almost all the offers are new builds. I have nothing against Irish Agents and undoubtedly there are some good deals to be had with them. BUT, There's always a but, Make sure they've done as much research as you. Also remember property anywhere (except 5th Avenue in New York) will seem reasonable to you given the state of the Irish housing Market. So here are somequestions to ask your agent if your think of using one to buy your foreign property. Also make sure to ask them a few questions you already know the answer to!. Add to it as you see fit

1. Are the Major Investors in the development Irish
2. What's the second hand market for the same property
3. What are comparable new developments in the area selling for
4. How long does he think it will take to shift this property 2 years down the road.
5. Is there a local market for the property. Ie. are locals of the country in question buying into this development
6. Ask what the capital Gains tax is in the country in question(just to see if he/she as a clue!)
7. What kind of discounts are on offer for buying more than one property.
8. Are rental returns guaranteed and tell them straight out that your worried the guarantee is factored into the price
9. Who and What's the rental market in the area(especially important in emerging east european markets)
10. Why did the agent get involved with this particular development.
 
Q6 is a good one to ask the agent, and you could add inheritance tax and property tax to that. And also how the income tax on the rent (assuming you are planning to rent it) are calculated. You could even ask them about the eviction procedure for non-payment of rent. Should give you some idea as to how much they know the local market/system.

Most of the other questions are good questions, but I wouldn't bother asking the agent. You really want to get these answers independantly of the agent.
 
I think it's important to find out if it's a bona fide Irish Developer or an Irish Financial Services Institution backing the development or what's the mix. I'm interested in whats driving a Realor to choose this particular development.
The financial institution backed developments that I've seen in the south of Spain and I'm thinking of a few golf related resorts in particular, I believe paid over the odds for the land and in poor locations with poor access. I thinking they are dining out on the fact that Irish Investors will and have paid over the odds for these properties because many investors are doing their price comparsions with prices in Ireland!.
I think there is a bit of the 'Irish Pub' mentality also, We more likely to trust our own.But go to any City in the world and undoubtedly you'll find an Irish Pub. you'll also find the drink will also be double the price of anywhere else.
 
and in the case of Spain you could ask them about the tax on the 'notional rent' even if there is not such rent you are taxed as if there is.
 
Having an Irish developer with a letter from the AIB is no guarantee of anything. There are lots of apartments with problems in Turkey or Bulgaria and two developments near Dubrovnik that left investors out of pocket after falling through. The Paddy mentality is something that doesn't go in most countries, having a German or Austrian backed builder is far more to the point.
 
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