Dear International Living Reader,
When someone asks, I recommend that, to build a diversified international real estate portfolio, it’s best to have $50,000 to $250,000 of capital available to start. That’s not exactly pocket change, I realize.
But you don’t need nearly that much money to begin profiting from international real estate.
What could you do with, say, $15,000 (or less) to invest? Here are two suggestions:
– Go off-plan. Pre-construction (or "off-plan," as it’s called outside the States) investing is a way to invest in new developments while they are still in the planning stages. The best part of this kind of investing can be the terms: an initial deposit of 5% to 10% of the purchase price with no progress payments required until completion of your unit. You want to sell–and take your profits–before this balance is due. I consider this a medium- to high-risk investment, because of the level of leverage. (Note that the best developments aren’t necessarily the ones with the best terms.)
Right now, I know of deals in the U.K. requiring less than $14,000 down; in Panama, you can invest for as little as $5,000 down.
The thing I like best about this type of investment (apart from the potential for extreme returns–of, say, 100% to 400% in 12 to 18 months) is the ease–you don’t need to visit Britain to buy off-plan there. For example, I’ve never been to Newcastle (in the north of England)…have no intention ever of going. When I found an off-plan development there that I liked–after I did the necessary analysis and research from my office–I bought. No travel required.
– Get your piece of the world’s #1 tourist destination. The leaseback program in France was created as an incentive to invest in French tourism accommodation. I’ve told you about it in detail before (see The Most Powerful Real Estate Secret in the World) but basically you get a discount off the purchase price, hassle-free returns–with 25% down, you can expect between 12% and 15% annualized returns over nine years–and easy financing.
Right now there is at least one development in Normandy you can buy into with as little as $10,000 down, including closing costs, although you should consider better locations where you can expect better appreciation if your budget allows. Leasebacks are low-risk.
Finally, a housekeeping note: Our International Real Estate Investment Forum in Washington, D.C., is scheduled for April 7 and 8. I’ll be there, along with some of the foremost international land investment experts we know. Places are limited–you may remember our last event in October sold out fast. Contact Patricia Goltry at conferences@internationalliving.com or tel. 1-866-381-8446 (toll-free in the USA/Canada) for more details. Hope to see you there.
Lief Simon
Real Estate Editor, International Living
