What makes a good buy-to-let property overseas?

What makes a good buy-to-let property overseas?

Many of us dream of owning a second home abroad. It becomes our personal getaway, where we can take time out in idyllic surroundings.

But, while the lifestyle aspect plays an important role when deciding to buy an overseas property, the biggest reason often comes down to money. Letting out a property can bring both significant and long term financial rewards.

It’s therefore no surprise that more and more people in the UK are turning to overseas property investment and we’ll continue to see a rise in 2016. Investing in a property abroad can provide buyers with a steady rental income as well as a base for regular holidays. But what makes a good buy-to-let overseas property? Here are five things to consider before making a purchase.

Location

Find a property that holidaymakers will be able to enjoy at any time of the year – and avoid one that is dependent on specific seasons such as a ski chalet in the winter. Most people will follow the sun, so buy a property in a destination that offers warmth and sunshine. Consider traditional holiday home markets like Spain and France, but also look further afield to areas like Cape Verde. Look at accessibility too. Check which airlines fly to your preferred location and how easy it is to get around once holidaymakers arrive. Safety and security is becoming more important too, so check the government’s travel advice.

Type of property

Once you have found a location, research the types of properties that visitors to that area will want to stay in (and what they can afford to stay in). Is there a demand for individual villas and apartments or hotel rooms and suites on a resort? Investing in a property on a hotel resort, for example, could offer greater rental returns, especially if the resort is run and marketed by a well-known tour operator. Weigh up all options and keep your target market in mind. Families might prefer staying on an all-inclusive resort that offers a level of service, as opposed to a self-catered apartment.


Activities

While some holidaymakers wish for a fly-and-flop destination, many want a place that offers a wide range of activities and classes. Again, this comes back to your target market. Those looking to relax will enjoy stunning beaches, health spas and a la carte restaurants but, if you want to purchase a property suited to families, look for one that offers access to daily entertainment, a buffet restaurant and a child-friendly swimming pool. For the more active types, consider destinations that offer resorts equipped with a gym as well as those that run watersports activities such as kite surfing and scuba diving. And for those seeking a romantic holiday or a honeymoon destination, invest in a five-star property that is catered for adults only.

Managed scheme

As with any buy-to-let property, signing up to a management scheme will increase an investor’s chances of success. You’ll be supported on all aspects of running an overseas property from advance holiday bookings through to property maintenance – highly recommended if you are living and working in the UK. If you buy a property on a resort that is run by a well-known operator, consider signing up to its hotel management scheme. The resort is likely to be marketed on a global scale through travel companies, agents and tour operators, meaning you can expect ongoing rental income.  

The future

Tourism plays a major role in driving holidaymakers to overseas property and, for as long as people continue to travel abroad, the property market will continue to grow. Therefore, regularly look at tourism figures for your preferred destination. Is the number of visitors growing year on year? Also research what the local government is doing to boost tourism. Key infrastructure improvements including supporting foreign investment and leisure development, as well as modernising the utilities, telecommunications and transport links, are clear signs of strong investment.

Finally, choose an overseas property that you are comfortable with buying. Buy-to-lets are no longer only accessible to the new and experienced, with new investors able to take advantage of various payment options. You can purchase a property outright or, if you have fewer funds to release, take advantage of fractional investments. Whichever route you choose to follow, high rental yields is the most important factor behind a decision to purchase an overseas property and, with developers like The Resort Group, you are guaranteed a minimum rental yield.

For more information, visit www.theresortgroupplc.com

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Samantha Goodman
Samantha Goodman 11 Aug 2017

Interesting point of view.

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Samantha Goodman
Samantha Goodman 11 Aug 2017

It depends on the people, some older adults decide to make a long-distance move in order to live closer to their children or settle in a place with a lower cost of living.

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brandonlee10
brandonlee10 24 Jul 2017

The financial ramifications of the triggering of Article 50, the starting gun for Britain's departure from the EU, are far from clear. Buyers will be most cautious in London, given that buying a home in...

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IrisJ.
IrisJ. 19 Jul 2017

Great advice, but may I also add that when buying an already built home, make sure you do all of the proper inspections. Most importantly pest inspection because people tend to get surprised when they

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IrisJ.
IrisJ. 17 Jul 2017

The third point is, in my opinion, the most important one. People have become too inconsiderate and careless when it comes to rented properties. If a landlord wants to protect their property, regular visits...

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cornishalan
cornishalan 10 Jul 2017

Added to the cost of purchasing these village properties are the above average maintenance costs. Particularly where the property is a listed building or requires specialist building skills such as thatching...

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Jo Mullett
Jo Mullett 07 Jul 2017

Here in Swansea, known as the Japanese knotweed capital of the UK, it never fails to amazes me that people have no idea of the potential problems this invasive non-native plant can cause when buying or...

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NathanG
NathanG 05 Jul 2017

McDonalds, for example, have been purchasing their real estate on prime locations for years. If something happens to the company they'll have invaluable assets that will be able to save them. We might

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Jonah
Jonah 04 Jul 2017

Graham: surprised to see you cite the "extra tax liability" as capping out at ?560. It doesn't - the extra tax is exponential, as it is levied on the income (i.e the inflating level of rental income you...

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Dianne Griffen
Dianne Griffen 29 Jun 2017

Be very wary of anyone bringing you deals that they have ?found? and want to ?sell on to you? or ?joint venture? with you on ? you need a proper legal contract for this, involve a RICs surveyor to confirm...

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jason hadzikostas
jason hadzikostas 28 Jun 2017

The most important thing is a budget. Students have to manage their spendings in food, house maintenance, books and many other things. According to me, student Studios are the perfect option for them as...

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SecomTech
SecomTech 22 Jun 2017

AT Last...This was discussed years ago and there was a move towards landlords registering their bad tenants on a database..(can't remember where) It seems a logical step though our leaders will probably...

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