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The prospect of buying a home abroad can be thrilling, but finding the perfect deal and location in the global market isn't always easy. Here are tips to help homebuyers find international deals that will make good financial sense in the long run.
The first step to finding that lucrative international real estate deal is knowing where to go. There are currently some "excellent buys" in countries that have gotten hit hard by the recession in the global market, like Spain, Greece or Italy, says John Brian Losh, chairman and publisher of LuxuryRealEstate.com, a compendium of residential real estate firms around the world.
But these opportunities aren't risk-free. "You've got to buy into a volatile economy," he says.
—John Brian Losh, chairman and publisher of LuxuryRealEstate.com
Also, Losh recommends looking into regions that are former British colonies, such as Belize or the Bahamas. These places "usually have excellent infrastructure," he says, and they tend to be more stable politically, making them a safer foreign investment.
"You don't want to buy a house and then have it nationalized," he says.
After narrowing the search down to a region, it's critical to find the right real estate agent.
First and foremost, the agent must be "someone whom you trust," says Roma Niessen, a luxury real estate agent at Coldwell Banker Horizon Realty, based in Kelowna, British Columbia. Just as important, she says, "They have to know the market. And not just know it, but really know it well." For example, a quality agent should be able to immediately inform buyers about "what has sold, where and for how much," Niessen says.
They also should know the prime locations like the back of their hand. "A block one way or the other can make a huge difference in your investment," Losh says. "Safety, security, walkability of the streets - all that plays into a good value."
It's also important for individual homebuyers to consider the qualities in foreign property that they place a high value on.
"You want to make sure you locate where your peers are," Niessen says. And don't forget to think about amenities that are a high priority, whether that's proximity to public transportation or art museums or ocean views.
Finally, Niessen says to make a "must haves" list and a "wish list." Buyers should stick to their lists, but also trust their instincts. "Sometimes all the criteria on your list can be met, but if the gut reaction is wrong when you walk in, walk away," she says.
When buyers' lists and gut feelings align, they can sign up for email market-rate alerts through a trusted online foreign exchange service to help facilitate international payments for their foreign property purchases. Market-rate alerts can notify homebuyers when a desirable exchange rate arises, making it easier to secure the latest exchange rates for down payments or ongoing mortgage installments.
Once the right house has been found, buyers should still be mindful of their future prospects of selling the foreign property. "Buy well for yourself now, but also for future investment," Niessen says. "If you decide five years later to move up or move on, I want to say, 'Sure, no problem. I can move that property for you.'"
Example: 1USD = xx INR
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