Have you thought about owning property abroad? There are many advantages to this, such as access to a holiday home instead of searching for deals every summer, integrating into a local community and learning the language and culture, and earning regular money through rentals.
The downside is that you have a double mortgage on your books for a number of years, and it can be challenging to run a profitable business from another country. Still, the benefits are there if you are in the right position financially and are willing to take a few calculated risks.
Holiday Home
Forget about searching for a holiday home for the summer; you already have an overseas property waiting for you. Holiday home property overseas is an excellent idea if you are creatures of habit who enjoy a familiar location every year. Even if you are not letting out the property, you can still earn from it as holiday home or Airbnb, learn more at Cava Buys Reviews.
New Communities
Owning a property in an overseas location means becoming part of a new community. Even if you only stay there once or twice a year, you will be family in the local area, contribute to taxes and the local economy, and be accepted as a local in general. This is good news if you want to learn the local language and integrate. But remember to carry out some localization research.
Higher Letting Value
If you own overseas property, chances are you can charge higher rents than if you held property in your home country. In general, holiday rentals are more expensive for shorter stays, so while you might have more turnover, you also earn better from the rents. An overseas property can be a getaway for your family, but it can also bring in enough to cover the mortgage.
Double Mortgage
One downside of owning property overseas is the additional mortgage that you will have to manage and guarantee. Along with the mortgage for your domestic residence, you need a second one for your holiday home. There is a chance you can lose money on this investment if your rental guests are not consistent. But it could still be worthwhile to sell the property later on.
Rental Shortfall
If a rental shortfall occurs and you can’t cover your mortgage payments, you will have to pay the mortgage from another fund; make sure you have an emergency fund to cover this eventuality. Due to the inconsistency of rental income for some overseas properties, some mortgage lenders might be unwilling to issue a mortgage; it all depends on the investment opportunity.
Final Thoughts
Overseas property is a viable investment if you have the funds to cover intermittent mortgage payments if you intend to buy the property to sell at a later date. There are many advantages to owning an overseas property, including personal and financial gains; however, there is also a lot at stake, and you need to be ready to take calculated risks that are supported by lenders.
