The top 4 international property investment markets
If you’re looking to invest in offshore real estate – that is, markets outside of North America – there are four key markets you should look at first.
Lief Simon, international real estate investor and co-founder of Live and Invest Overseas, says he’s all in on overseas markets. And he has shortlisted four countries to help build your investment portfolio and personal freedom plan.
Why? International property stands out more than ever among investment options because it is both a hard asset and one of the best opportunities for generating cash flow while building real, long-term, even legacy wealth.
What makes these countries star performers? He says they are the world’s best options for diversifying across markets, currencies and asset types for both value appreciation and cash flow of up to 17 per cent per year that can continue for decades. In some cases, you can invest with as little as US$35,000.
Rental apartments and agricultural opportunities are the two key target areas here. Panama City, where resale transactions have slowed, is and will continue to be a buyers’ market in the short term. This year is a chance to buy on a dip, because, long term, Simon remains very bullish on the Panama City rentals market.
Yields continue to be strong, though not as strong as they were a couple of years ago, primarily because rents have softened.
Argentine, Colombian, and Venezuelan buyers have helped to keep the Panama City market stable and growing over the last dozen years, while other markets in this region have struggled or even collapsed.
Today, North Americans and Europeans continue to invest, but it’s Panama’s new relationship with China Simon predicts will fuel this economy through its next stage of growth. Chinese are arriving in Panama in volume and bringing lots of investment capital with them, just like they did in Vancouver in the 1990s. He foresees spikes in property values to new levels.
The second big opportunity for making money from real estate in Panama in 2019 is productive land. This country’s interior is a fertile breadbasket. Individual investors can even participate in organic plantations for turnkey agro-profits.
Brazil is a large country with many different property markets, some more interesting than others.
“I recommend focusing on the Fortaleza area,” Simon says. “This coastal region is a top destination among Brazilian tourists. Rentals targeting the local holiday market can earn better than eight per cent net yield reliably.”
The Brazilian real remains stable against the U.S. dollar (at around 4.09 reais to US$1) and has been historically weak relative to the rate of 1.6 reais to the dollar of a decade ago.
Good yields and a weak currency make this country a very strong buy.
Thailand appeals primarily for its agriculture, but it also deserves attention for its strong economy and expanding tourism industry.
The challenge in Thailand is that restrictions are placed on how foreigners can own property. Foreigners are able to own land only on leasehold.
A foreigner can hold freehold title to the construction on the land, but, unless the house is portable, you might not take comfort from that. Foreigners are also permitted to own condos freehold as long as they don’t own more than 49 per cent of the total area of the condo building. For this reason, the condo market is where most foreign investors focus their attention. A condo is also cheaper and easier to manage as a rental than an individual property.
Bangkok was the number-one visited city in the world in 2017 and last year received more visitors than London or Paris. Again, that’s worth the attention of would-be property investors, says Simon.
Property markets in Portugal have been on the move since 2015. Some neighborhoods in Lisbon, for example, are now priced beyond what Simon believes is reasonable for an investment property. Other areas of this city, however, continue to offer good value and opportunity, especially if you’re up for a renovation project.
In this, the fourth quarter of 2019, Simon recommends focusing on the lesser-visited areas along the country’s Algarve coast and the Porto region north of Lisbon. And in Portugal, it’s possible for a non-resident to obtain a mortgage for the purchase of a property.