Buy Property Abroad
Wise
- Up to 75% cheaper than banks
- Multi-currency card usable in 160+ countries
- 70%+ transfers arrive in under 20 seconds
If you want to escape the West, I advocate an approach of spreading important parts of your life across the world.
This tactic is often called “Five Flags”, although I personally see 6 distinct facets to this approach, and I call it “Bases” instead, because … well, it sounds better.
- Residency: Where you can legally stay (so not just on a visa, actual Permanent Residence)
- Citizenship: Where you are a citizen, where you have a passport
- Business: Where your businesses are located
- Source of income: Where your money comes from (ideally from several unrelated, non-Western countries)
- Banking: Where you have bank accounts, in other words where you put your money
- Assets: Where you keep your assets, the things you invest in
Making sure you have those bases in at least a few different countries is extremely important if you want to experience freedom, both physically and financially.
After all, if you keep all your bases in one country, that one country can make or break you (let’s be honest, it’s the “break” part that’s the issue!).
That one government has complete control over your life, and that is a terrifying prospect in my eyes – but that’s a topic for many other articles.
Today we’ll take a look at investing in property abroad, more specifically real estate.
Why would you buy property abroad?
Real estate, such as land, houses and apartments, is a prime example of an asset that you can have in another country.
I’ve got many years of personal experience with this, and overall I can fully recommend it.
Buying real estate abroad is a great way to put some of your capital in a nation where you do not live, because it is usually a pretty straightforward transaction.
In addition, you diversify your investment portfolio, ánd you could potentially turn it into an income-generating-asset.
- If you rent it out, someone will pay you money every month.
- The rental yield abroad is often much higher than it would be in the West.
- Investing in property abroad or even buying land overseas can also vastly increase the size of your investment portfolio, because in many cases real estate abroad rises rapidly in value.
There’s also the fact that if you buy a condo in, say, Thailand, you’ll be able to do so at a much lower price than if you were to do this in Los Angeles.
And finally, there’s the matter of personal security. It feels great to own real estate somewhere else, because it provides you with an escape plan.
In case things turn sideways wherever you are currently staying, it’s a vast relief to know that you are just one flight away from your other home, someplace you can lay low or hang out whenever you want, because it is yours.
To me, there’s the additional benefit of knowing that my family will be okay, even if I end up biting the dust. I will never leave them with nothing, because they’ll just inherit my properties and thus will always have a roof over their head, plus a way to get income via the rent from the other units.
Where to buy property abroad?
In theory, you could buy property abroad in nearly every country – barring shitholes like North Korea and Afghanistan (but why would you want to?).
You do have to keep in mind that this often comes with many restrictions.
- For example as a foreigner you cannot own land in many Southeast Asian countries, only the condominiums built on top of it.
- Other potential types of restrictions are not being allowed to own anything close to 50 miles from the border (to avoid smuggling).
- In some countries you can own the property, but cannot rent it out.
I’ve examined dozens of countries in Africa, Asia, South America, and elsewhere on their real estate prospects, and I’ve looked at:
- Rental yield
- Can you own property as a foreigner?
- How’s the visa situation?
- Other factors such as the economy, crime rate, price of the real estate, …
Going by the numbers alone we come to the conclusion that these countries are the best prospects to buy property abroad:
Note: I would advise you against investing in Georgia and Mongolia, because of the looming threat of Russia. If it can happen to Ukraine, it can happen to them.
Foreign Property Ownership & Residency Matrix
Key Takeaways
- True Freehold Foreign Land Ownership: If outright freehold land ownership is your non-negotiable requirement, only Panama, Paraguay, Colombia, and Georgia (non-agricultural only) allow foreigners to buy land on equal terms with locals.
- Condo-Only Markets: Philippines and Thailand do not allow land ownership, but their 100% freehold condo structures are highly established, liquid, and straightforward for foreign investors.
- 50-Year Leasehold Restrictions: Vietnam, Mongolia, and Tanzania strictly bind foreign buyers to leaseholds or state-owned land titles rather than true perpetual ownership.
How to buy property abroad?
Buying real estate abroad isn’t easy if you want to do it from a distance.
If you are inside the country, it usually won’t be an issue at all, as long as you have the money and some valid IDs.
Simply find a place you’d like to buy, negotiate with the owner, and conclude the transaction.
Buying from private persons
I would advise against buying from private persons, because that could end in misery.
Some people could see your foreign-ness and take advantage of it, especially in countries where the legal system is pretty “fluid”.
Buy from big real estate agencies, that will most likely be perfectly safe and reliable.
But always keep in mind that safety does not come from the real estate agency; it comes from the law and being thorough, like hiring an independent local real estate attorney (who has no financial relationship with the broker or developer) to conduct due diligence, title searches, zoning checks, and escrow management.
Buying at a distance
If you are trying to buy property in a foreign country while you are still in another, most likely Western, nation, you’ll be faced with some difficulty.
In some cases, it might not even be possible at all, because a physical person will need to be present to sign and accept important documents such as the deed.
You’d have to find or have a contact person on the ground, and give that person Power of Attorney to sign on your behalf.
Don’t do that if you don’t know that person, or if you don’t trust him or her.
In truth, there isn’t much he or she can do wrong if it’s drafted properly, it’s not like a POA is a carte blanche, but still.
However, an improperly or broadly drafted real estate POA grants an attorney-in-fact the legal power to alter contract prices, redirect wire transfers to personal accounts, accept encumbered titles, or take out mortgages/loans against the property, so make sure you do your due dilligence here!
Investing in property abroad – in summation
Buying a house, apartment, land or other piece of real estate in another country is a great way to diversify your portfolio and attain assets abroad – requisites for a financially safe life, in my opinion.
You’ve got plenty of choice between countries, but according to my research I’d stick to a few noteworthy options, such as Paraguay, Colombia, Panama, Vietnam, Thailand and the Philippines.
Doing this is pretty straightforward if you are actually present in the country you’d want to buy the property in, otherwise you’ll most likely have to engage a third party to arrange this for you.
If you’re interested in buying real estate in the Philippines, I happen to offer such a service, so get in touch!
Wise
- Up to 75% cheaper than banks
- Multi-currency card usable in 160+ countries
- 70%+ transfers arrive in under 20 seconds
How good are property management services in these countries?
It varies wildly and depends on the country and the specific city, as well as on other factors.
In my opinion, in Uruguay, Paraguay, Panama, Vietnam, Thailand and the Philippines you should be able to get a reliable property management service after doing some research. The others I’m not too sure about, but if you engage an actual company with an actual legally binding contract, it should be fine.
I would strongly advise you to look for such a service in person, while you are there, so you can get a better feeling of the people you’ll be dealing with.