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Tips to Save Money on Overseas Property

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Many of us have had the experience of travelling abroad and falling in love with a quiet country village or tropical beach community. Have you ever been tempted to buy property overseas? It may seem like a daunting prospect to deal with language barriers and fluctuating exchange rates, but investing in overseas property can be well worth the trouble when the timing’s right. Many Americans and Europeans are now choosing to retire overseas, drawn to the higher quality of life at lower prices. This could make international property a good investment for the future. However, there is also a certain degree of risk involved with buying property abroad. Take a look at the following tips to learn how to mitigate this risk and potentially save money on foreign real estate.

Research the Market

The real estate market is important when you’re buying property at home, and it is equally important when purchasing property abroad. While on one hand Homesales real estate Sydney prices may be low, they could be on the rise in neighbouring Indonesia. In addition to researching the housing market, you’ll also need to learn more about the specific laws regarding real estate and foreigners in your country of interest. Some countries limit real estate ownership by foreigners. The country’s political situation and currency rates are also important to research, so that you can make a decision regarding your investment.

Take Currency into Consideration

It’s ideal to purchase property when your home currency is strong in comparison to the currency of the country of interest. Because the currency market can be somewhat turbulent, there are a few risk management tools put in place to protect foreign investments. One option is to enter into a Forward Exchange Contract, which allows the investor to lock in a particular exchange rate and pay these funds in the future. Another option is to place a Limit Order, which specifies a currency exchange rate that you wish to complete your transaction at. If this rate is reached, a dealer can make the transaction.

Translate Important Documents

Language barriers are another issue to contend with. It’s important to fully understand all of the paperwork that goes into a real estate transaction, so you will need to have them professional translated to read all of the fine print. Both you and the seller must be clear about all terms, and professional translation can help avoid misunderstandings or legal difficulties.

Use a Legal Advisor

Although it may be tempting to purchase real estate directly from the owner, it’s generally safer to use the services of a professional when purchasing property overseas. Even if you have researched the market, you may not understand the nuances that go into foreign real estate. It’s worth hiring a real estate agent or legal representative before you proceed with the transaction.

Compare Transfer Rates

A final hurdle to overcome for foreign property investors is the cost of bank transfers. Some banks will charge outlandish fees for international payments, which can really add up if you are making regular mortgage payments to a foreign account. There are specialised online foreign exchange companies which offer more competitive rates. It’s worth comparing your international money transfer options to find the most advantageous rates.

Purchasing real estate overseas can be a dream come true, and by taking your time to research your options thoroughly you could save a great deal of money in the process.

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AUTHOR Derek

My name is Derek, and I have my Bachelors Degree in Finance from Grand Valley State University. After graduation, I was not able to find a job that fully utilized my degree, but I still had a passion for Finance! So, I decided to focus my passion in the stock market. I studied Cash Flows, Balance Sheets, and Income Statements, put some money into the market and saw a good return on my investment. As satisfying as this was, I still felt that something was missing. I have a passion for Finance, but I also have a passion for people. If you have a willingness to learn, I will continue to teach.

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