Jul 21, 2020
Renting out a property you own is a great way of earning yourself a regular income. However, buying a rental property overseas can be a bit more complicated. Before you take the plunge on an overseas buy to let property, make sure you are aware of the following tips.
Be Realistic About Your Locations
There are some property markets that are always almost guaranteed to turn a profit for you. For example, London, Paris, and New York are always going to be high in demand for property renters and buyers. However, these are difficult and expensive markets to break into, especially if this is your first buy to let venture. For most investors, it makes sense to gain some experience with letting out properties before shooting for such a high-end property market.
Research The Tax Situation
Tax arrangements vary around the world. If you are renting out a property in another country, then you will almost definitely have to pay some tax on your earnings. If you are a UK citizen, then the government is going to want their cut of your earnings. It is important that you fully understand the tax obligations that come with your latest investment before you commit your finances to it.
Check Local Rental Rules
Whenever you are planning on starting any kind of business, you need to be aware of what the local laws and regulations are. These don’t just apply to things like the amount of tax that you need to pay. You also need to know what your legal obligations and rights are as a landlord. Don’t assume that renting a property overseas will involve the same tasks as it would back home; there can be some striking differences between different markets.
Know Your Exchange Rate
If you are going to regularly be transferring money between your home nation and the nation you are investing in property in, you need to find the most cost-efficient way of doing so. There are now currency transfer specialists that you can work with to identify the most efficient route.
Get Landlords Insurance
Anyone who is planning on renting out property within the UK or Northern Ireland will want to take a look at landlords’ insurance. For Northern Ireland properties, businesses like compareni.com make it easy to check prices for landlord insurance NI to ensure that you are getting the best deal possible. Landlord insurance NI will protect your property from fire, flood, and other damage. You can also opt for rent protection insurance because, no matter how thoroughly you vet tenants, there is always a chance that they will fall into financial hardship.
If you are going to be buying a buy to let property outside the UK, make sure you investigate the local equivalent to the landlords’ insurance you can buy here. Most countries have something similar in place.
Buying a buy to let property overseas can be an excellent way of building out your property portfolio. But before you commit to a particular property or market, make sure that you have thoroughly researched all your available options.