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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Latest Comments

Oliver Conway
Oliver Conway 18 May 2017

Making a neat inventory is a good idea, but if the seller is not willing to provide it, can the buyer demand it?

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Bertrand
Bertrand 17 May 2017

First step to nationalisation of the private rented sector IMHO. Nanny state poking their noses into things yet again. I object, as a decent landlord, sometimes having to deal with some pretty awful tenants,...

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Izzy
Izzy 16 May 2017

This is such a great a post. I love the detail you've gone into. It's a very useful article for helping those who are looking at deciding which sector they would like to go into! When I first started investing...

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paul burnham
paul burnham 30 Apr 2017

Jeremy Corbyn's pledge that a Labour government would build 500,000 new council houses must electrify the general election campaign. Reliance on markets and the profit motive has brought huge housing-related...

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CommercialTrust
CommercialTrust 28 Apr 2017

Sadiq Khan?s announcement of an online database of landlords and letting agents who have been convicted of housing offences, appears on face value to be a variation of the already implemented Database

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warren
warren 26 Apr 2017

You're very welcome Mary! Glad you enjoyed them :)

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Mary Ward
Mary Ward 26 Apr 2017

Thank you for the wonderful ideas. First impressions can make or break a deal. It's sadly that many homeowners drop the kerb to create an off-street parking space.

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Tony Gimple
Tony Gimple 14 Apr 2017

I'm not at all surprised that so many landlords are still confused about what the tax changes really mean and how it will affect them. In particular, the blind rush to incorporation is leaving landlords...

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MH
MH 13 Apr 2017

You are right that the bank holidays are going to be spoiled in looking for the properties. But people who want to sell their property and looking for the better relocation, they can get benefits of this...

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bnellyb
bnellyb 08 Apr 2017

There will be an exodus of private landlords over the next 5 years as tax changes take effect, private landlords provide an important service to the rental market, why do housing associations and councils...

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Fred Cassman
Fred Cassman 07 Apr 2017

"Make it look like you are at home": often people forget this and share on facebook their location!

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jared townsend
jared townsend 05 Apr 2017

It'll be interesting to see how & if the Government's asset sale regarding mortgages helps

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