If you are planning to purchase a real estate property outside of your country, for e.g. a home,consider that as a type of international investment. A wise type of investment will require some research at your end or by some real estate agency located in the country where you plan to purchase a piece of real estate property. See if you can personally the country and view the property you are interested in purchasing which may be as per your lifestyle or investing preferences. Also do some local real estate market research. Once all is finalized see the investor residence programs as per the country’s rule when it comes to real estate overseas. This is especially worth noting and applicable if your foreign realestate property is a residence. There are programs oriented to provide benefits to foreign nationals buying real estate properties and investing in businesses in their country. For e.g. Ireland provides a certain minimum real estate purchase of about $510,000 as well as an investment of around 565,710 in immigrant investor bonds. So if you are considering investment residency program, you will need to assure that your method of ownership will satisfy eligibility to participation in it.
The various types of ownership
Ownership by personal name will have some drawbacks including liability exposure that is if you own real estate personally, be it in U.S., you may face a lawsuit when something would go wrong. Such as some accident that may occur ending up injuring others.Another thing to consider is lack or protection against creditor’s claim, which is limited liability if you place your overseas property on a trust or corporation. Also if your property abroad is in your own name, it can be subjected to your creditor’s claims in case you run into financial trouble and your creditor decides to go after yout assets in order to recover for themselves.
U.S. legal entities are to be considered as well. To avoid any risk associated with the personal ownership, there is an option to form a corporation or some LLC in United States as the corporations and LLCs exists under the state’s law and the laws will vary from state to state. Like in states such as Delaware or Nevada, you do not need to form your business entity. By placing your overseas properties in a corporation or LLC you can also the two risks of personal ownership mentioned above. Note that lenders will often have additional requirement for corporations and LLCs which may require you to sign a personal guaranty. Your new real estate property will be shielded from other creditors and you will receive liability protections of a corporate or company ownership which makes it a wise choice for many foreign real estate owners. Trusting is a vital part when it comes to property ownership abroad and certain types of trusts will offer protections to corporations and LLCs and forming a trust is important.Different trusts will serve different purposes, choosing the best one for your personal situation will require a careful consideration of the benefits as well as the limitations of the options that are available. Also worth considering is where the property would be located and if you are purchasing the property for investment purpose. In the same manner the type of property you are buying will also matter when it comes to making it a rent able property assuming that it has accommodations accordingly. As well as how long do you intend to own the property and whether you would be the sole owner or will be involve your spouse or another family member or even a co-investor as well as the tools you would be using for the protection of the real estate planning and protecting the assets.
Managing your currency when buying real estate property abroad
Amount which they can get will vary for foreign currency investors as it can change real fast. But that does not mean that you have to depend on the rather unpredictable currency markets. You can accurately plan the budget for your foreign real estate property in advance. Best option is a forward contact that is best suitable for large international transactions. You should be careful so that the amount of your national currency you would need for your property purchase will not alter substantially. With the forward contract, you are eligible to fix for a favorable exchange rate a year in advance. Spot transfer in comparison is risky as it depends on whatever the market rate would be at that given time. Avoiding the difference in exchange rate, especially when it is at its strongest, can save you thousands of dollars. You can also do a combination of stops-loss and limit orders for better rate if the market would turn against you. Simply stretch your funds further and make a better budget to enjoy a peaceful experience when purchasing property overseas.
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