Buying a property and then hoping for the best is not a strategy.There are plenty of overseas property markets that are seeing high capital growth and that are ideal for the average UK based property investor as long as we clearly define our strategy and make sure that we are aware of all the costs and risks that are involved. The key is to make sure that you can see the whole picture and not just a narrow part of it.

So, how to make money in overseas property?

• Find out which markets are growing. Don’t ask developers or agents for this information! Find out where the professional investors are buying. You won’t find any private equity funds, pension funds or institutional investors buying in any of the markets that are typically sold to the general public as “investment property hotspots”.
• Avoid typical home-in-the-sun properties in over-supplied markets like the plague.
• Look for markets that have good growth indicators such as population growth, new mortgage laws, major new infrastructure projects, major economic or political reforms, liberalisation of property/land law etc.
• Define the amount you intend to invest, the period over which you intend to hold the property and calculate the likely profit taking into account all ”grey costs” such as tax, dilapidations, periods of non-occupancy etc.
• Check for comparative prices and rental amounts of similar properties in the same location. Do they stack up with what is being predicted?
• Plan for the most effective management of any tax burden likely to be created.
• Plan the most effective way to finance the purchase. Often UK finance can be more cost-effective than finance available in the country where you intend to purchase.
• Monitor the performance of your investments closely and be prepared to react to any change of performance expectation.