Real estate investment has gained ground especially since the launch of several Golden Visa programs. While some countries have offered residency, others offered citizenship by investment. A gradual transition from residency to citizenship is also possible in certain programs.
Real estate investment has attracted many people because of many benefits including tax advantages and income generation.
You may ask where to start when you decide to invest in real estate abroad. You can find the important steps while investing in properties in a foreign country below.
Let’s first start with how to benefit from real estate investment.
Why Real Estate?
Real estate investment comes with certain advantages such as the following:
- Gaining income: You can gain passive income through residential properties for a long time. Rental income also increases especially if the property’s at a good location.
- You have a physical investment: It’s up to you to rent, live in, or visit it.
- It’s always popular: The demand for real estate always exists. So, you’re sure to get returns from a real estate investment.
- It’s flexible: Once you’ve bought a property, you can rent, flip or sell it. You can also add parcels. In this way, you’re in control of your investment.
How To Invest
Crowdfunding or real estate syndication, fix-and-flip, REIT, wholesaling and rental property are some of the ways to invest in real estate.
What To Consider
The following list explains the key points while making a real estate investment.
Check All the Costs and Consider Your Budget
Checking your budget before investing in a property is a very important step. You need to make sure if you have lots of debts or not. Or, make sure if you have enough budget for a down payment and so on when investing in real estate.
Also, note that extra fees will appear when you invest in real estate. Taxes, utility costs, and insurance are a few of them.
Evaluate the Property Taxes
You need to check all the property taxes in the country you’ve bought the property. Mostly, it’s the value of the property that determines property taxes. It also depends on the purpose of buying as well. You may also need to pay annual taxes as well.
Get To Know About the Neighborhood
Checking the neighborhood is also an important step while making a real estate investment. You can search if the area is a popular one. Or, you can learn if there’ll be an infrastructure project in the future.
Check the Inheritance Laws
Some countries require making a will when you buy property. In some countries like Spain, your assets as a resident pass on to your descendants. If you want to change it, you need to prepare a Spanish will.
Tax Liability is Important To Consider
Note that tax residency applies when you live in the property you bought permanently. To avoid paying double taxes, check if there’s a double taxation treaty. It must have been signed between your home country and the one you bought the property from.
Getting Residency and Citizenship are Different Processes
Residency and citizenship by investment programs entail different requirements. They also offer different rights. Usually, getting citizenship requires a few years of qualifying residency. However, countries like Turkey offer citizenship within a few months.
Get Professional Advice
Getting help from a professional will be a time and money saver for you. They’ll tell you the possible costs and examine the property.
Working with property investment companies, like UK-based RWinvest, can help make the entire process much simpler.
They can assist with helping you understand the more intricate details behind the big decisions. For example, which investment strategy is the best fit for your needs or where to find the latest property hotspot.
If you don’t have the money upfront and don’t want to deal with mortgage repayments and mortgage brokers, investment companies can also often provide structured payment plans.
Where To Buy Property
Countries like Portugal, Greece, Spain, and Turkey offer residency or citizenship through investment programs. Through these programs, you can buy a property and get residency and/or citizenship in that country.
Non-EU/EEA/Swiss citizens can buy a property and get residency in Portugal. The Golden Visa Program has enabled more than 9,500 investors Portuguese residency through real estate investment.
Portugal Golden Visa provides the right to live, work, and study in Portugal. Visa-free travel among Schengen countries is another advantage of the program.
Greece’s Golden Visa is similar to Portugal’s. It’s sufficient to buy real estate at a minimum amount of €250,000. You can then get a Greek residency. This allows you to live and work in Greece with your family.
Turkey offers a citizenship by investment program as well. The minimum investment amount is $250,000 for real estate purchases. Within four to six months, you get citizenship in Turkey. Many people from different professions choose to invest in real estate in Turkey. It offers a great climate and nature for its residents.