Buy To Let: Overseas Property

Buying to let an overseas property is an excellent way to see a return on your investment. The income from letting your property will cover the mortgage costs whilst you sit back and watch the property prices increase. Easy!

Well, if you buy the right property in the right location then yes it can be. However, you could end up seeing your property sit empty whilst you have the cost of keeping it, and even worse the property value may remain static or even drop!

What To Consider When Buying To Let Overseas

Location, Location, Location!

Yes it is important - see overseas rental property hotspots for 2008; but you should also consider what type of property to buy.

Villas are a very popular choice for families, family groups and larger groups or friends. The very word 'villa' conjures up thoughts of a sitting by your own pool sipping a cocktail. People like a bit of luxury - especially on holiday as a treat. So if you're budget can stretch to a villa it would be worth considering.

Apartments are affordable for both buying and the rental market and are a good choice for resorts, especially golf resorts. If buying an apartment it's best to buy a two-bedroomed one at the very least as a one-bed apartments would limit your potential rental market.

If you're buying an off-plan property the developer may offer a rental guarantee as an incentive.

The Practicalities of Letting Your Property

There is obviously a cost involved in letting your property. Clients have to be found, schedules managed and the property needs to be kept clean and presentable. If you are funding the purchase with an overseas mortgage you will have to ensure your lender knows it is a buy-to-let property. Other considerations include insurance and public liability insurance; the regulations will differ from one country to the next.

To keep it simple it is worth finding an agent to do all of this for you. Of course they will take a percentage of the lettings or charge a flat rate for administration, but this can be worth the cost in most cases. They'll have an established client base and a website, brochure and mailing list to which they can add your property.

See our guidance on how to find an overseas property company.