Overseas property
The excitement of owning an overseas property can turn usually cautious individuals into ones that are prepared to sacrifice their common sense. Risks that they would not entertain in their own country are being made every day by some overseas property buyers. The thought of losing the home of their dreams and confusion about the buying process has some buyers signing contracts in a language they do not even understand. Some are not taking advice from qualified solicitors or other independent professionals. Others throw their complete trust into real estate agents who have a vested interest in selling them a home. They also believe wildly exaggerated forecasts on rental returns to help them feel secure about the purchase of their holiday homes.
The truth about renting
The rental income you can achieve on letting your holiday home is all about location and the type of property. Long term rentals can be heaven sent, having a person willing to rent on a long term basis will reduce the likelyhood of having a bad tenant. It will also serve to reduce your stress in finding new people willing to rent your home. Best of all long term rentals are great for your financial planning. Short term rentals can be higher especially in holiday seasons. The perfect holiday home would be a property that was attractive to both types of tenants. Many city apartments are good examples of this and present a win win situation to the overseas property buyer. Areas in France, Spain and Portugal for example really lend themselves to both rental markets. Recently Bulgaria has attracted overseas property buyers who can let to both summer holidaymakers and to the winter skiing fraternity.
Do your own research act like a tenant
It is important to do your own research when assessing the rental value of a property abroad. Put yourself in the position of a tenant or holidaymaker. Conduct local research matching your requirements to the property you own or intend to buy. Rental markets like house prices have peaks and troughs and will have periods in the year when demand may outstrip supply. Know when these periods occur for your rental property. Holiday homes are particularly vulnerable to off and high peak pricing. You will need to compare like for like to get it just right for your property.
Furnishing your property abroad
Many buyers forget about the cost of buying furniture and do not even consider the local laws regarding furniture, electrical items, fire safety and gas appliance safety. In your own country these areas have strict regulation and it is probably the same in the region you intend to buy. Owners need to know what the exact situation is regarding local regulations to avoid disastrous mistakes.
Have a budget
Owners need to have budget for unexpected costs for repairs and general maintenance. An advertising budget should be set along with a marketing strategy to let your home fast. Good marketing could save you thousands in lost revenue from your overseas property.
Decide when you are going to use your holiday home
Many buyers intend to let the home to holidaymakers and also spend time in the property themselves. This creates a conflict as the best time to visit your holiday home abroad may be the time you can make the most money from your overseas property investment. This will be for you to decide.
Renting a holiday home can be the best thing you ever did. Overseas property buyers are winning not only on owning a holiday home they can use, but also the fact that efficient renting can pay for their investment.
Copyright 2006 Nicholas Marr
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