Property market: investing in a second home abroad

By : Nick Marr


Who never dreamed of owning a house in more exotic places such as Florida, Spain, Greece or even Polynesia? A survey released earlier this year by the Organisation for Economic Co-operation and Development (OECD) has revealed many interesting facts for individuals looking to invest in a property abroad as well as for professionals such as British property managers Factotum. The set of data more particularly focused on the relationship between market price and long term return on investment. In what sunny location will you get the most bang for your bucks then? Experts warn that it first off depends whether people want a holiday home to enjoy right away, or if they are ready to wait a little before making an ideal profit.

A few factors seem to play in early on to encourage prospective buyers: the property should be located in a safe political, legal environment, with easy access and no sanitation issues. For instance, North Africa had a good potential a few years back, but relative political unrest is preventing the property market to rise again. The same goes for Turkey: the country had enjoyed a relatively prosperous period with a whopping 19% rise in property market prices in 2015 alone. But its vicinity to a war zone might soon put a halt to this property market bubble.

Other countries nearby such as Croatia or Greece can also seem attractive but many people are put off by a possible lack of local transportation (especially for property located on an island).

Despite the ongoing popularity of countries such as Portugal and Spain, more and more people are now starting to look outside of Europe for their dream holiday home and potential winning investment. Mauritius is a good contender and so are Thailand, Cambodia and Vietnam, who offer extremely good value for money, despite not being the most stable countries out there on the political front.

Australia and New Zealand are also currently enjoying a nice surge in property market prices. But many prospective European buyers are being put off by the distance and it remains a little niche compared to more global property markets trends.

South America has a lot of things going for it but legal agreements are not easily respected there and it’s an obvious dealbreaker for both the seasoned property investor and less professional buyer alike. Prices are very attractive indeed but nothing guarantees you will be able to resell it later, let alone for any kind of profit.

On the other hand, buying and selling a property in Honduras for instance is completely doable but you might encounter issues when trying to bring back the money you made of your property back to Europe as an authorisation is specifically demanded for such financial manoeuvres. It’s actually the case in many countries in South America and while you might strike gold by investing on another continent, those are definite risks you need to be aware of.